Poverty headcount ratio as an alternative measure
The poverty headcount ratio provides a straightforward understanding of poverty within a given population. It measures the proportion of individuals living below the poverty line. This alternative measure offers a clear and concise way to assess poverty levels and track changes over time. By focusing on the percentage of the population affected, it paints a vivid picture of the extent of poverty experienced by a community. Policymakers and researchers use this ratio to develop targeted interventions and evaluate the effectiveness of anti-poverty programs. Understanding this metric is crucial for addressing the challenges faced by marginalized and vulnerable populations.
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Palma ratio
The Palma ratio is an economic indicator that measures income inequality within a society. It compares the share of income received by the top 10% of the population to the share received by the bottom 40%. This ratio provides insights into the distribution of wealth and the concentration of economic power. A high Palma ratio indicates a significant wealth gap, suggesting that a small portion of the population controls a large proportion of the income, while a lower ratio suggests a more equal distribution of income. By understanding the Palma ratio, policymakers and economists can gain valuable information to address income disparities and promote a fairer society.
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