Head Count Ratio

The Head Count Ratio (HCR) is a very common, long time in use, monetary measure to assess the degree of poverty of a country. The HCR is defined as the ratio of the number of people with income less than a predefined value to the total population size of a country (Sen, A. 1976). Thus the HCR indicates the percentage of people in a country that life below a defined poverty line.

The poverty line can be defined on a national or international basis. The poverty lines at national level differ widely across nations. The international poverty line is defined by The World Bank and is the same value for all nations. It allows to compare the degree of poverty across nations. The international poverty line
used to be at $1.25 (per day) from 2008 until October 2015 when The World Bank raised it to $1.90 (per day) in order to take changes in the costs of living into account. Hence the actual international HCR indicates the percentage of people per nation that live on less than $1.90 per day.

The HCR is surveyed by The World Bank on an annual basis since the 1980s. Since income data is difficult to acquire most datasets are incomplete, which means that for some countries the HCR is only available all 4 to 5 years.