Constructing Harmonized Consumption-based Welfare Aggregates for Poverty and Inequality Analysis in Caribbean Countries

Overview & Synopsis

This report documents the steps followed to construct harmonized consumption-based welfare aggregates in four Caribbean countries -Grenada, Jamaica, Saint Lucia, and Suriname- and produce internationally comparable poverty and inequality estimates using the latest living conditions and household budget survey data available in each country. Despite the efforts to maximize comparability across countries, full comparability is not achievable due to differences in questionnaire design and data constraints. When considering the best consumption-based welfare aggregate available for each country, poverty measured against the upper middle-income poverty line of US$6.85 per person a day (adjusted for 2017 PPP) is the highest in Suriname, with nearly one in five people (18 percent) living in poverty in 2022. Saint Lucia shows the lowest rate, with less than one in ten (8 percent) of its residents living in poverty in 2015. In both Grenada and Jamaica, around 14 percent of people lived in poverty in 2018 and 2021, respectively. Inequality, as measured by the Gini index, appears to be high by international standards, with all four countries recording figures close to or above the World Bank threshold of 40 Gini points for high-inequality countries.