Relative Poverty and Absolute Poverty: What’s the Difference?

Absolute poverty is when basic life requirements—food, clean water, and shelter are lacking or falling short and are measured against some universal standard. Relative poverty, on the other hand, is a state where the economic status of an individual or a family is far below the average set living standards within their society.

Consider two families: one cannot afford clean water and enough food (absolute poverty), and another can afford basic needs but does not manage to put on newer clothes or access educational resources common in their community (relative poverty). This difference is a testimony to the difference between the struggle for survival and social exclusion arising from economic discrepancies. Absolute poverty is a state of lacking essentials universally recognized, while relative poverty is less income and fewer possessions than others around one.

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Table of Content

• Comparative Table: Relative Poverty and Absolute Poverty
• What is Relative Poverty?
• What is Absolute Poverty?
• Difference Between Relative and Absolute Poverty

Comparative Table: Relative Poverty and Absolute Poverty

What is Relative Poverty?

Relative poverty measures the economic status of individuals or households compared to the broader population within a specific society. It's defined by living conditions and income levels significantly below the average in a given country or region, reflecting inequality rather than an absolute lack of resources.

People experiencing relative poverty may afford basic necessities but still cannot maintain an average standard of living, facing social exclusion and limited access to opportunities. This concept emphasizes the social and economic disparities within societies.

What is Absolute Poverty?

Absolute poverty refers to a condition where individuals lack the basic necessities of life, such as food, clean water, shelter, education, and healthcare, necessary for survival. It's measured against a predefined standard of living, often quantified by the international poverty line set by the World Bank. 

Those living in absolute poverty struggle to meet their minimal needs for physical health and well-being, facing extreme challenges in daily survival, often in developing countries. This stark form of poverty highlights the urgent need for global efforts in poverty alleviation.

Difference Between Relative and Absolute Poverty

Definition: Relative poverty is based on societal standards and inequality, while absolute poverty focuses on a global threshold for basic survival needs.

Measurement: Relative poverty measures against the median income of a society; absolute poverty uses international standards like the poverty line.

Criteria: The criteria for relative poverty change with societal norms and economic conditions; absolute poverty criteria are constant and based on essential needs.

Variability: Relative poverty varies by country and over time; absolute poverty is consistent globally.

Focus: Relative poverty highlights social exclusion and inequality; absolute poverty emphasizes a lack of fundamental resources for life.

Intervention Goals: Interventions for relative poverty aim to reduce economic disparities; for absolute poverty, they aim to meet basic human needs.

Conclusion

Absolute poverty is the complete absence of basic needs necessary for the continuation of life, like food, housing, and safe/clean water. On the other hand, relative poverty is defined as the level below which a person or family does not have the income or resources to acquire a given minimum level of normal living conditions in the society to which one belongs.

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