surveys, public opinion surveys and different “big data” approaches are some of the alternatives discussed.

The paper is organized as follows. Section 2 discusses the importance of having regularly conducted HBSs<sup>3</sup> to measure monetary poverty. Section 3 describes the evolution of the statistical capacity of MENA. Section 4 summarizes the availability of HBSs in the region and compares data availability to that in other regions. Section 5 presents potential ways to address gaps in data availability and innovative data approaches to supplement existing estimates of monetary poverty. And Section 6 concludes.

# 2. Importance of household budget surveys in measuring and understanding monetary poverty

“Household budget surveys” (HBSs) is a generic term covering a broad category of surveys that might also be referred to as “family expenditure surveys” or “income and expenditure surveys”, among others. The common goal of these surveys is to collect information about household “budgets” reflected in expenditure, consumption or/and income. Many surveys add other modules to the core consumption/expenditure section, to collect information on education, labor market, nutrition, and housing conditions. The most common practice is to use consumption, expenditure, and income to derive a money-metric measure to calculate poverty rates (Dang et al. 2019).<sup>4</sup> National governments and international organizations use HBSs to inform poverty monitoring systems which track progress towards achieving regional/global poverty targets and which help formulate operational policies.

Having comparable and up-to-date household budget surveys is crucial for monitoring global and regional poverty trends. To measure extreme poverty at the international poverty line (USD1.90 2011 purchasing power parity (PPP) exchange rates), the World Bank uses either current consumption/income distributions from the most recent surveys or updates old distributions using GDP per capita or private consumption growth rates.<sup>5</sup> In addition, the World Bank uses consumer prices indexes (CPI) and PPP exchange rates to account for variations in prices across countries and to convert distributions from local currency units to a comparable international currency.

Lack of a recent HBS for a country leads to omission from global and regional poverty counts because outdated surveys provide outdated distributions, which, if included, would lead to inaccurate poverty estimates (this also depends on the quality of macroeconomic numbers and their underlying relationship with household well-being --see detailed explanation and empirical results illustrating the issues in the Annex). For these reasons, if surveys are two years older than the reference year selected for reporting of global poverty numbers, and outdated surveys account for more than 60 percent of regional population, regional poverty estimates are not reported.

Until recently, MENA did not report regional poverty due to the lack of recent HBSs but also because of the presence of unreliable PPP exchange rates for several MENA countries (Atamanov et al., 2018). Once

> 3 Several countries measure income poverty using labor force surveys, for example the Dominican Republic and Ecuador.  However, these cases are exceptions and this practice is rare. We discuss briefly the issue of using labor force surveys to measure poverty and its applicability to the MENA region in the Annex.

> 4 Leaving aside the debate about different approaches to measure household welfare, we use “consumption”, “expenditure” and “income” terms interchangeably as measures of household living standards.

> 5 Find a detailed explanation of issues related to monitoring of global/regional poverty in the Annex.

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