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Top1. Introduction
Human development focuses on extending people’s actual choices along with substantive freedoms as well as abilities that permit them to possess lives that they are worth (Sen, 1999). Persons who are living under the clutches of ill-health, illiteracy, and poverty are incapable of leading the lives that they value. Therefore, any assessment of the improvement process should be centred on its effect on the quality of life and human well-being. In modern society, every person has the right to be an active and productive participant in the process of development. But, the development and technological advances that took place above the years possess inexplicably benefited better-educated, high-skilled employees (OECD, 2011). Thus, there exists a persistent exclusion of poor, low-skilled, and marginalized sections in society from the process of economic development. Exclusion and poverty are highly correlated and both impact each other as cause and vulnerability factors (Ramachandran, 2016). Addressing poverty in its multifarious forms is crucial for ensuring inclusivity in development and it is formulated as the first Sustainable Development Goal by United Nations.
In the conventional approach, poverty or deprivation is perceived as one-dimensional with household income as the measure. But in currents years there has been an expanding consent concerning the deficiency of income poverty measures (PM) (Sen, 1992). The deficiency of income-based PM stems from the following facts. In the first place, markets function very imperfectly and at times fail in the provision of some necessary goods. Such situations necessitate the need for non-market alternatives and institutions. Secondly, the capacity to convert income into useful resources or functioning is different for different households. The recognition of these limitations and growing demand as of governments to plan official PM has directed to the development of methods to determine poverty in a multi-dimensional approach (Alkire and Santos, 2013).
The measurement of poverty involves 2major steps: detection of who is poor, together with accumulation of poor to ascertain the level of poverty in a society (Sen,1976). In the unidimensional income space, the detection of who is poor is comparatively straightforward, and the income poverty line—the income required to buy basic goods and services—dissects the population into the poor as well as the non-poor (Alkire and Santos, 2013). Whereas in a multidimensional approach, contemplation is given to the aspects that must be fulfilled by the poverty index that aggregates individual information into a general indicator. The most often utilized index is the Foster-Greer-Thorbeck (FGT) index.
For measuring MPI various methodologies are proffered that are generally grouped into axiomatic as well as information theory approaches, latent variable methods, together with fuzzy set theories (Alkire and Foster 2011a). The technique proffered by Alkire and Foster (2007, 2011a) that goes with the axiomatic scheme, is the method that is experientially executed to the largest scale via the MPI (Alkire and Santos 2010; UNDP 2010; Alkire et al. b). The MPI is an index of acute multidimensional poverty; it replicates deficiencies in extremely rudimentary services along with centre human functioning for people (Alkire and Santos, 2010). It is also utilized extensively in nationwide multidimensional PM developed by various national governments.