Designing and implementing an older people-specific multidimensional poverty measure: An application to a middle-income country

We contribute to the literature on poverty measurement in older age in low- and middle-income countries by designing and implementing a comprehensive and policy-relevant older people-specific multidimensional poverty index based on the Alkire-Foster method, estimated using data from four waves of Peru's national household survey (2018, 2019, 2022, and 2023). Our measure includes 15 indicators spanning seven dimensions: social connectedness, knowledge, health, employment and social protection, shelter, water and sanitation, and energy. We set a referential threshold that identifies an older individual as multidimensionally poor if they experience deprivations in at least three out of seven dimensions of our measure. Our results show that multidimensional poverty incidence among older people in Peru has decreased by 8.6% between 2018 and 2023 but remains high at 35%. Older women, older people living in rural areas, older indigenous people and older people with disability are multidimensionally poorer than their counterparts, with deprivations contributing the most to multidimensional poverty varying across subgroups and subnational regions. Our findings can guide policymakers in prioritising resource allocation by identifying key deprivations to reduce multidimensional poverty among older adults. We estimate that 23% of the older population experience multidimensional but not monetary poverty, highlighting the complementarity of these approaches. Additionally, we find 12% of older people living in multidimensional and monetary poverty simultaneously, rising to 30% in rural areas. Our study bridges the most up-to-date conceptual and empirical literature on multidimensional poverty with the literature on poverty measurement in older age in low- and middle-income countries.