TO CITE: Khazanah Research Institute. (2019). The Absolute vs Relative Poverty Conundrum. Retrieved from http://www.krinstitute.org/assets/contentMS/img/template/editor/Views_The Absolute VS Poverty Conundrum.pdf POVERTY LINE INCOME Malaysia uses the poverty line income (PLI) to measure absolute poverty. The current PLI methodology is revised in 2004/2005. Prior to that, the PLI is calculated for a model household of five members in 1977, updated annually with the consumer price index (CPI). After the revision, the PLI is calculated for each household, adjusting for household composition, age distribution, gender, and regional differences. The underlying philosophy is still cost of basic needs, calculating the amount of household expenditure needed to fulfill both food and non-food needs, and using income to determine whether households fall above or below the poverty line. POVERTY RATE The incidence of poverty fell from 37.4% of households (394,797 households) i...
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