Friday, September 30, 2011

Rs 33 and you are rich --Doctor wrong diagnosis and worse wrong medicine

Is it possible that we can ever find the easy way to define poverty? Is poverty about lack of ability or is it of lack of opportunities? Can we quantify poverty and is there a magic number that encapsulates the poverty debate?

Well the planning commission of India is of the opinion that poverty is the lack of cash to be exact of Rs 32/-. Well the planning commission can be so exact because they use a measure that is erroneously based on a price index set up in the 1970s which they interpreted wrongly. In essence the commission is perpetuating an error and even worse believing it. Ever heard of the doctor who made an error in diagnosis and even after knowing that it was an error ended up giving the wrong medicine because he was not ready to check his assumptions . Well the same is the case here.

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