Explanatory Notes on the 2003 Poverty Estimates

C. Per capita income versus family income as the more relevant indicator for analyzing poverty

• For purposes of poverty analysis, per capita income is the more relevant indicator than average family income since in the computation of poverty incidence, the per capita income is compared with the per capita poverty threshold instead of comparing family income with the poverty threshold for the family. Another obvious reason is that two families, with the same level of family income may have different poverty status – one nonpoor, the other poor, if one family has a small size while the other is very large. In this sense, the per capita income of the family, rather than the total family income would provide a better indicator of the family’s poverty status.

• Presented in Appendix Table A and Table C are the complete regional tables of real per capita income and real family income, respectively, by income decile. Consistent patterns between the trends in poverty incidence and the real per capita income are achieved in all regions except in Region X. On the other hand, the use of real family income results in inconsistent patterns in NCR, Region V and ARMM.

For these notes, inquiries may be made with Ms. Redencion M. Ignacio or
Ms. Glenita V. Amoranto at telefax number (632) 896-7981 or at their
e-mail addresses rm.ignacio@nscb.gov.ph / gv.amoranto@nscb.gov.ph.