Concepts Quote by Milton Friedman
“I think in some ways it would make more sense to have as a poverty level a relative concept and say, the level of poverty is that level of income or that level of consumption below which 10 percent of the people now are.”
About This Quote
Source Essay: Capitalism and Freedom, 1962
Poverty should be defined relative to the population’s distribution, using a percentile threshold to capture those most in need.
In simple terms: Define poverty by income percentile.
Key Takeaway
Use relative thresholds for policy.
Themes
economics
poverty measurement
policy
inequality
Mood
analytical
concerned
Type
theoretical
policy‑oriented
When to use this quote
- setting welfare eligibility
- designing tax credits
- targeting aid programs
Key Concepts
relative poverty
percentile threshold
social welfare
income distribution
Questions to Reflect On
- Is a percentile cutoff fair across regions?
- How do you address cost of living differences?
A Different Perspective
Relative measures can miss absolute deprivation in low‑income societies.
