We must not let poverty of thought stop India from tracking deprivation
₹20 per capita per month," and the commission called them poor. In their classic study, Dandekar-Rath defined the poor in terms of an average consumption of 2,250 calories per capita per day, equivalent to ₹15 for rural areas and ₹22.50 for urban areas, both in 1960-61 prices. This became the poverty line for academic studies in India and around the world.
At around the same time, in the early 1960s, US president Lyndon Johnson launched a war on poverty in the US. The identification of the poor, for policy purposes, was constructed to be equal to the money equivalent of families of three or more whose food expenditure was more than one-third of their total spending. Using this method, poverty in the US was estimated as 20% in the early 1960s, and then dropped rapidly to 12% by 1968.
It has hovered in the low-teens since then. In the early 1970s, the World Bank entered the poverty arena in a big way. In a paper published in 1979 titled ‘Growth and poverty in developing countries,’ authors Montek Singh Ahluwalia, Nick Carter and Hollis Chenery laid much of the groundwork for the poverty research that followed.
Issues pertaining to definition, measurement and forecasts were discussed in detail. The authors explicitly rejected a calorie consumption approach and opted for a monetary poverty line; and lack of consumption-survey data for several developing countries made them reluctantly opt for an income rather than a consumption-derived poverty line. The poverty line chosen under the International Comparison Program (or ICP, later to be named PPP) was $200 per capita per year in 1970 prices.
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