Absolute Poverty and Relative Poverty

Running head: ABSOLUTE POVERTY AND RELATIVE POVERTY
ABSOLUTE POVERTY AND RELATIVE POVERTY
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1ABSOLUTE POVERTY AND RELATIVE POVERTY
Introduction:
Poverty is an economic state that makes people experience lack of specific needs that are
considered as the essential amenities for the lives of human beings. It is important to mention
that the definition of poverty varies according to regions (Lewis, 2017). Specific areas
experience poverty at a significantly higher level compared to the other areas. Therefore to
develop a universal definition of poverty is hard. Poverty is of two types, relative poverty and
absolute poverty. The aim of the paper is to differentiate between absolute poverty and relative
poverty is discussed. Also, the paper highlights the contrast and comparison between the two
forms of poverty.
Absolute poverty:
The term absolute poverty can be used to refer to the condition of poverty where an
individual is incapable of meeting the essential commodities that are needed to sustain life and
other basic needs. It is a condition that is set and same across every country. The absolute
poverty is a state of extreme poverty where the individual does not possess wealth as well as a
lack of basic health. In regard to absolute poverty, it is the biological needs which are mandatory
to survive are crucial to take into consideration. Absolute poverty is static and therefore it is do
not change over a period of time (Hagenaars, 2017).
Relative poverty:
The term relative poverty can be defined as the standard of living that involves the basic
needs however when compared with other individuals the economic standard of living is low.
The relative poverty is subjective in nature, and it varies according to countries. The relative
poverty is a state that can make a person rich in a particular society, and the same person might

2ABSOLUTE POVERTY AND RELATIVE POVERTY
be poor in another society. The relative poverty is measured by the poverty line which says the
minimum amount of income one requires to sustain (Heger, Zens & Bangalor, 2018).
Contrast and comparison:
Relative and absolute are two methods of measuring the poverty levels. Although the
absolute and the relative poverty, both are used to measure poverty, they differ specifically in the
way they are defined. Lack of biological necessities such as food, clothes, shelter, drinking water
and sanitation is called absolute poverty. On the other hand, relative poverty, also known as
extreme poverty refers to a poverty line which determines the income a person needs in order to
satisfy basic needs. To manifest in a simpler form, lack of basic necessities is absolute poverty,
and relative poverty plays a role in income inequality aspect.
According to Shildrick and MacDonald (2013), absolute poverty refers to a set of
condition that is universal in nature and they are same in every country across the world.
Absolute poverty is constant and therefore it is do not change over a period of time. Relative
poverty refers to the condition that are subjective by nature in the society. Due to the fact it is
subjective in nature, it is varies country to country and prone to changes along with time. For
example, more urban cities will have greater education, transportation cost, energy which will
result to a higher poverty line compared to the poorer countries. According to Ravallion (2017),
a person who falls below the poverty line is certain to be in poverty however the person can rise
if the state of the country improves in terms of its wealth. In regard to absolute poverty the
poverty line is constant and universal therefore, it is the same minimum standard for everyone
across the globe. People that are considered poor under the relative poverty, they certainly have a
source of income although it is lower than the set income level. The only reason for considering
them poor is due to their incapability meeting certain standards preset by a society. An example