Poverty Rate Definition

Published Dec 23, 2022

Definition of Poverty Rate

The poverty rate is defined as the percentage of people living below the poverty line. That means it is the proportion of people in a given population who cannot meet their basic needs for food, clothing, and shelter.

Example

To illustrate this, let’s look at the poverty rate in the United States. According to the U.S. Census Bureau, the poverty rate in the United States in 2019 was 11.8%. That means more than 1 in 10 people in the United States did not make enough money to be able to pay for the most essential things every human needs, such as food, clothing, or rent.

Why Poverty Rate Matters

The poverty rate is an important indicator of a country’s economic health. It measures the effectiveness of government policies and programs aimed at reducing poverty. It also helps to identify areas of need and target resources to those areas.

In addition, the poverty rate is also used to measure the level of inequality in a society. A high poverty rate indicates that the gap between the rich and the poor is widening, which can lead to social unrest and other problems.

Important Disclaimer: This definition was written by Quickbot, our artificial intelligence model trained to answer basic questions about economics. While the bot provides adequate and factually correct explanations in most cases, additional fact-checking is required. Use at your own risk.