Is poverty an absolute concept or a relative concept? There are clearly some components (such as access to food, clothing, and shelter) that we would consider necessary in any society, but there are other components that are clearly society–specific.

(a) Identify some components of “minimum needs” that you feel are specific to one society but not another.

(b) Do you think these relative components are purely social (or cultural) or are they apt to change with the per capita income of a country?

(c) Because poverty has these relative components, consider the following poverty measure: anybody who has less than half (or some predetermined fraction) of the per capita income of a society is poor. Why is this a bad approach to poverty measurement?

(d) Try and identify some basic “capabilities” that you might want any human being to have for example, every person should be capable of obtaining adequate nutrition, every person should be capable of obtaining “adequate” housing, means of transportation, and so on. Treat the right to such capabilities as absolute. Now can you reconcile the relative and absolute notions of poverty using these absolute capabilities as a starting point? On these and related matters, read Sen [1985].