What is the Difference Between Objective and Subjective Poverty

The main difference between objective and subjective poverty is that objective poverty focuses on people’s access to different types of resources whereas subjective poverty focuses on indicators of standards of living people actually enjoy.

Poverty is the state in which an individual or community lacks the financial resources and necessities for a minimum standard of living. The income level of a poor person is so low that he or she cannot fulfil his or her basic human needs, which include clean water, healthy food, proper housing and medical attention. Moreover, there are different ways to measure poverty. Objective and subjective measures of poverty are one such method.

Key Areas Covered

1. What are the Classifications of Poverty
     – Absolute Poverty, Relative Poverty
2. What is Objective Poverty
     – Definition, Characteristics
3. What is Subjective Poverty
     – Definition, Characteristics
4. What is the Difference Between Objective and Subjective Poverty
     – Comparison of Key Differences

Key Terms

Objective Poverty, Subjective Poverty

What are the Classifications of Poverty

There are two main classifications of poverty as absolute poverty and relative poverty. Absolute poverty is the condition where an individuals’ income cannot meet basic personal needs or living standards like food, shelter and clothing.  It is possible to compare absolute poverty in different countries, and over different time periods. This is because this measure is independent of people’s locations or time periods.

Figure 01: Absolute Poverty Rates in the UK

Relative poverty, on the other hand, is a level of poverty that changes depending on various contexts. This is a condition that occurs when an individual cannot meet a minimum level of living standards when compared to others at the same place, at the same time. Moreover, those who live in relative poverty do not essentially lack all basic needs, but they may not experience the same standard of living as the majority in that society.

What is Objective Poverty

Objective poverty or objective measures of poverty involves normative observations and judgements as to what creates poverty and what needs to be done to alleviate poverty. It basically focuses on individuals’ access to different types of resources. We sometimes also call objective perspective of poverty as welfare approach.

Furthermore, economists have traditionally measured poverty in objective perspectives. The main issue with the objective measure is finding a reliable and valid measure of the economic resources and defining the drawing of the poverty line.

What is Subjective Poverty

Subjective poverty or subjective measures of poverty, which is based on the concept of felt poverty, is not a commonly used concept. Subjective measures generally refer to indicators of the standard of living individuals in the society actually enjoy. This concept focuses on people’s preferences, and how much they value goods and services.

Furthermore, subjective measures of poverty are based on the opinion people hold about themselves in relation to society as a whole. Most people feel poor if the people around them have more than them. In addition, the individuals against whom they measure themselves are referred to as the reference group.

Difference Between Objective and Subjective Poverty

Definition

Objective poverty or objective measures of poverty involves normative observations and judgements as to what creates poverty and what needs to be done to alleviate poverty. Subjective poverty, on the other hand, is a concept based on felt poverty, i.e.,  opinion people hold about themselves in relation to society as a whole.

Focus

Objective poverty focuses on people’s access to different types of resources while subjective poverty focuses on indicators of standards of living people actually enjoy.

Conclusion

In brief, objective and subjective measures of poverty are two methods to measure poverty. Objective poverty focuses on people’s access to different types of resources whereas subjective poverty focuses on indicators of standards of living people actually enjoy. Thus, this is the main difference between objective and subjective poverty. 

Reference:

1. Singh, Ajeet. “Poverty.” LinkedIn SlideShare, 5 Apr. 2014, Available here.
2. “Poverty.” University Information System MENDELU, Available here.

Image Courtesy:

1. “Absolute poverty rates (After Housing Costs) in the UK, 1997-2014” By The Institute of Fiscal Studies – Living Standards, Poverty and Inequality also (Public Domain) via Commons Wikimedia
2. “824233” (CC0) via Pixabay