The challenge of measuring poverty and inequality: a comparative analysis of the main indicators

Abstract

This paper presents a review of the main available indicators to measure poverty and income inequality, examining their properties and suitability for different types of economic analyses, and providing real-world data to illustrate how they work. Although some of these metrics –such as the Gini coefficient– are most frequently used for this purpose, it is crucially important for researchers and policy-makers to take into account alternative methods that can offer complementary information in order to better understand these issues at all levels.