How the Poverty Line is Determined and Why it Doesn’t Matter

Most people in the world have heard the term “poverty line,” and yet most of us have never asked how someone ends up above or below this invisible line. How is it possible to have a line where someone is determined “impoverished” if they land above or below it?

We want to help you understand some of the process and thinking behind the poverty line and how it is determined.

In 2005, the World Bank concluded extensive studies looking at the currencies, income per person, and consumption of goods of every country in the world. By analyzing the power and weight of these items in comparison to other countries, The World Bank was able to develop an understanding of how living situations in some countries would compare to others.

In this last year, the World Bank released results of updated research increasing the poverty line to $1.90. The ambition of the World Bank is to see less than 3% of the world’s population living in extreme poverty in the next fifteen years. They agree there is still a lot to be done and the efforts are not easy, but after recent developments in third world countries they are optimistic to see a hopeful change.

So what should we look at when looking at people less fortunate than ourselves? Should we be determining if they are above or below this invisible line or should we look for opportunities to serve? The conversation surrounding the poverty line can be helpful in understanding the demographics around the world, but our heart needs to be to serve whoever is in front of us and in need.

Data and research can help us identify need. But it is important we don’t prioritize data above the people in front of us.

There are close to 900 million people living on less than the equivalent of $1.90 USD every day, and this is a huge deal. But above all, God has called us to use what we have to serve those whom He has placed in our lives. Maybe He has placed a difficult family member, or friends at school, or maybe the chance to put a child through school in another country as opportunities for service in your life.

Whatever the opportunity, we charge you to be intentional and to listen to the tug of the Holy Spirit in your heart.

For our team at Asian Hope, God has given us the opportunity to partner with impoverished children in Cambodia. For $42 a month, we can empower children to thrive in school and in life.