Average Income

In these countries, a different technique is used to draw the poverty line. It is drawn in relation to Average Income. For example, in Russia, all the people who receive less than the average income are regarded as living below the poverty line. But these people are grouped into three categories depending on the distance between the average income and their own income. Immediately below are the indigents, followed by the poor and the destitute. The indigents are those whose income is between 50 and 75 per cent of the average income; the poor are those whose income is between 25 and 50 per cent of the average income; and the destitute are those whose income is less than 25 per cent of the average income. Some scholars also follow the OECD procedure for drawing the poverty line at 50 or 60 or 70 per cent of the average income level. In both cases, it is the money income which is the measure, irrespective of its PPP (Purchasing Power Parity) value.