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Poverty is not one-dimensional. The Alkire-Foster index captures multiple deprivations—malnutrition, lack of education, no electricity, insecure housing—simultaneously. A person is poor if deprived in enough dimensions, even if income is above a line. This reveals different policy priorities than income-based measures.
From your study of development measurement fundamentals, you understand that measuring well-being is not straightforward and that income-based poverty lines — like the World Bank's $2.15/day threshold — provide only a partial picture. Multidimensional poverty measurement starts from a direct observation: a person can earn above the income poverty line and still lack clean water, live in a house with a dirt floor, have children out of school, and suffer chronic malnutrition. Income is a means to well-being, not well-being itself, and in settings with dysfunctional markets, poor public services, or gender-based exclusion, income may not translate into the capabilities that actually constitute a decent life.
The most widely used framework is the Alkire-Foster method, which underlies the UN's Multidimensional Poverty Index (MPI). It works in two steps. First, you define a set of dimensions and indicators — the global MPI uses three dimensions (health, education, living standards) with ten indicators such as nutrition, years of schooling, cooking fuel, sanitation, and electricity. For each indicator, you set a deprivation threshold: a child is deprived in schooling if no household member has completed six years of education; a household is deprived in sanitation if it lacks an improved toilet facility. Second, you apply a dual cutoff: a person is identified as multidimensionally poor if they are deprived in at least one-third of the weighted indicators simultaneously. This dual cutoff — deprivation within indicators *and* breadth across indicators — distinguishes the approach from simply counting deprivations one at a time.
The power of this approach is that it reveals patterns invisible to income measures. India and the Democratic Republic of Congo may have similar income poverty rates, but their MPI profiles look entirely different: India's deprivations concentrate in nutrition and sanitation, while the DRC's concentrate in education and electricity. This directly informs policy — a government looking only at income poverty would not see that its most urgent need is school construction rather than cash transfers. The MPI can also be decomposed by region, ethnic group, or gender, revealing which subpopulations bear the heaviest burden of overlapping deprivations.
Critics raise legitimate concerns. The choice of dimensions, indicators, weights, and cutoffs involves normative judgments — why weight education and health equally? Why set the poverty cutoff at one-third rather than one-quarter of indicators? Different choices produce different poverty counts. The Alkire-Foster method is transparent about these choices, but users must understand that the resulting numbers reflect both empirical reality and the values embedded in the index design. Despite these limitations, multidimensional measurement has become central to development policy because it forces attention to the actual conditions of people's lives rather than the abstraction of a single dollar figure.