To analyse poverty as a complex phenomenon, a wide range of monetary and non-monetary indicators, including multidimensional approaches, are used internationally. In the Republic of Moldova, monetary poverty is calculated using the absolute poverty estimation method, based on household consumption expenditure collected by the National Bureau of Statistics (NBS) through the Household Budget Survey (HBS).

Following user requests, in line with international best practices, this approach has been supplemented with multidimensional poverty measurement, which provides a more comprehensive view of non-monetary deprivation and contributes to a better understanding of poverty in the country. For the implementation of the National Development Strategy "European Moldova" and monitoring progress in the implementation of the 2030 Agenda for Sustainable Development and target 1.2, which urges countries to reduce by at least half the number of women, men, and children of all ages living in poverty in all its dimensions, the NBS has developed calculations for the National Multidimensional Poverty Index (MPI), which captures the simultaneous deprivations faced by the country's poor population in the areas of education, health, living conditions, and employment through a set of priority poverty-related indicators specific to the national context.

Thus, since 2022, the NBS has carried out experimental calculations of the MPI, followed by the development of the Methodology for calculating the multidimensional poverty index in the Republic of Moldova, approved by NBS Order No. 104/2023 and the publication of the Analytical Report Measuring multidimensional poverty in the Republic of Moldova in 2022². The observation unit for the MPI is the household. Therefore, all indicators are calculated at the household level, and a household is considered deprived if at least one member of the household has been identified as deprived. Thus, it is assumed that deprivations are shared equally among household members.

This information note reflects the results of the calculation of the National Multidimensional Poverty Index (MPI) for 2024, based on the Household Budget Survey (CBGC). According to the methodology applied,3 the MPI includes four non-monetary dimensions of multidimensional poverty (operationalized through 11 socio-demographic indicators):

1. Health– which includes indicators of household deprivation due to lack of access to healthcare services and health insurance for their members;
2. Education– includes indicators of deprivation in households with members who have not completed secondary education and NEETs (young people not in education, employment, or training);
3. Living conditions– includes indicators of deprivation for households that use polluting fuels, do not have access to sanitation or are not connected to the public water supply system, have poor housing conditions and are overcrowded;
4. Employment– includes indicators of deprivation in households with members who are unemployed or employed informally or seasonally in the labour market.

All dimensions of multidimensional poverty are weighted equally, receiving one quarter of the total weight (1/4) in the MPI. The indicators are weighted equally within the corresponding dimensions. The list and effective weight of each of the indicators measuring the dimensions of multidimensional poverty are presented in Table 1 in the Annex.

The main findings regarding MPI for 2024 are:

• incidence of multidimensional poverty, indicating the proportion of the population experiencing deprivation (facing at least 35% of the weighted indicators), was 25.6%;
• each multidimensionally poor person was, on average, deprived in 46 percent of weighted indicators. (the intensity of multidimensional poverty was 46.0%);
• MPI value for 2024 was 0.118, indicating that, on average, multidimensionally poor people in Moldova face 11.8% of the total deprivation measured by the MPI.

Multidimensional poverty indicators

In 2024, the incidence of multidimensional poverty (H) stood at 25.6%, representing the share of the country's multidimensionally poor population. This indicator, also known as the "multidimensional poverty rate," marked a decrease of 0.9 percentage points compared to 2023 and 1.9 percentage points compared to 2022 (Table 2 in the Annex).

The intensity of poverty (A) in 2024 was 46.0%, which means that each multidimensionally poor person is, on average, deprived of 46% of the weighted MPI indicators. Or, this reveals that among the 25.6% of the population identified as multidimensionally poor, the average degree of deprivation in weighted indicators reached 46.0% (Table 1).

The indicator that measures both the incidence of multidimensional poverty and its intensity is the MPI. It is used to provide a comprehensive picture of people living in multidimensional poverty.

In 2024, the MPI value was 0.118, which means that people living in multidimensional poverty face approximately 11.8% of all possible deprivations. The "total possible deprivation" refers to the situation in which each person is deprived according to all indicators. During the years 2022-2024, the MPI showed a steady downward trend (Table 2 in the Annex).

Table 1. Incidence, intensity, and value of the National Multidimensional Poverty Index, 2023–2024

Download data in format .xlsx

The truncated rate of an MPI indicator, or deprivation rate, represents the proportion of the population that is multidimensionally poor and deprived according to this indicator.

Figure 1 shows the truncated poverty rate values for the 11 indicators included in the multidimensional poverty analysis and presents the proportion of the population that is multidimensionally poor and simultaneously deprived in relation to these indicators.

In 2024, the highest deprivation rates among the multidimensionally poor population were recorded for the following indicators: sanitation (23.3%), polluting fuels (21.9%), and lack of health insurance (21.4%). At the opposite end of the spectrum, the lowest levels of household deprivation were recorded for unemployment (3.9%) and access to medical services (0.6%).

Therefore, 23.3% of multidimensionally poor people live in households whose dwellings are not connected to the public sewerage system; 21.9% live in households that use polluting fuels (wood, coal, oil) for heating, and 21.4% live in households where at least one member does not have health insurance.

Figure 1. Truncated multidimensional poverty rate at national level, 2023-2024, %

Download data in format .xlsx

The analysis reveals significant discrepancies in the MPI between urban and rural areas. Thus, the incidence of multidimensional poverty in rural areas is 37.6% compared to 10.0% in urban areas, with MPI values of 0.175 and 0.043, respectively. The disparity is amplified by the intensity of poverty, with people in rural areas living in multidimensional poverty suffering deprivation in 46.6% of weighted indicators on average, compared to 43.2% for people in urban areas (Table 2).

Table 2. Incidence, intensity, and value of the National Multidimensional Poverty Index, by place of residence, 2024

Download data in format .xlsx

Figure 2 presents the truncated multidimensional poverty rate in urban and rural areas and highlights the significant differences observed in poverty levels depending on the area of residence. The data show that rural areas have higher MPI values for all deprivation indicators analyzed, indicating a higher prevalence of deprivation among the multidimensionally poor population in rural areas. In particular, the most pronounced disparities are observed for sanitation and polluting fuels indicators, where the incidence of deprivation among the rural poor is about seven times higher than in urban areas.

Figure 2. Truncated multidimensional poverty rate, by place of residence, 2024, %

Download data in format .xlsx

An essential completion of the truncated multidimensional poverty rate analysis is to examine the percentage contribution of each indicator to multidimensional poverty. The percentage contribution represents the weight that each indicator has in the total MPI value, so that the sum of all contributions is equal to 100%.

Although the truncated rate shows the extent of deprivation among the multidimensionally poor, it does not reflect the weight that each indicator has in the total MPI value. Two indicators may have similar truncated rates but different contributions to the overall level of multidimensional poverty. This is because the value of the contribution depends on both the cut-off rate and the weight assigned to each indicator in the MPI calculation.

Figure 3 presents the percentage contributions of each weighted indicator to the total MPI value. The indicators that contribute most to multidimensional poverty are lack of health insurance (23.4%), years of schooling (18.4%), and decent work (15.7%). In contrast, the indicator with the lowest contribution is access to healthcare (0.5%).

In urban areas, the highest contributions are recorded for the indicators lack of health insurance (27.1%), decent work (18.0%), years of schooling (16.6%), and NEET youth (12.3%). On the other hand, in rural areas, the highest contributions are for the indicators: lack of health insurance (22.8%), years of schooling (18.7%) and decent work (15.3%).

Figure 3. Percentage contributions of MPI indicators, by place of residence, 2024, %

Download data in format .xlsx

The intersection of monetary and multidimensional poverty

When analysing poverty, it is important to assess how multidimensional poverty and monetary poverty (absolute poverty) manifest themselves, based on data on consumer spending, with absolute poverty being the traditional indicator used to measure poverty in the Republic of Moldova⁴.

The Household Budget Survey is a regular survey conducted by the NBS, serving as the main source for assessing monetary poverty and establishing the poverty threshold in the country. Since 2006, the NBS has used an absolute poverty line based on consumption expenditure to measure monetary poverty, facilitating the assessment of the impact of socio-economic policies.

In 2024, the absolute poverty threshold was estimated at 3,493.3 lei, and the expenditure level of 33.6% of the population was below this monetary poverty threshold. At the same time, 25.6% of the population was identified as multidimensionally poor, facing deprivation in at least 35% of the weighted MPI indicators.

As can be seen in Figure 4, place of residence plays an important role in the level of well-being of the population. In urban areas, the share of the monetarily poor population is 21.6%, and that of the multidimensionally poor population is 10%. At the same time, in rural areas, higher rates are recorded for both methods of poverty assessment: 42.9% of the population is monetarily poor, and 37.6% is multidimensionally poor.

Figure 4. Monetary poverty versus multidimensional poverty, 2024, %

Download data in format .xlsx

Figure 5 presents the relationship between multidimensional and monetary poverty rates, based on data from 2024. Thus, approximately 54.3% of the population of the Republic of Moldova is neither multidimensionally nor monetarily poor. Of the total 33.6% of the population that is poor according to the monetary approach, 20.1% is not multidimensionally poor. On the other hand, of the 25.6% of the population that is multidimensionally poor, 12.1% is not monetarily poor. At the same time, 13.5% of the population of the Republic of Moldova faces both multidimensional poverty and monetary poverty.

The differences between the two methods of measuring poverty show the importance of using them complementarily to monitor poverty, providing information about the poor population in different ways.

Figure 5. Overlap between monetary and multidimensional poverty rates, 2024, %

Download data in format .xlsx

Annex:

• Key indicators of the Multidimensional Poverty Index for 2022-2024 (66.68 Kb)

Notes:

¹ The data does not include the territory on the left bank of the Dniester River and the municipality of Bender.

² Analytical report Measuring multidimensional poverty in the Republic of Moldova in 2022.

³ Methodology for calculating the Multidimensional Poverty Index is available on the official website of the NBS.

⁴ Methodology for calculating the absolute poverty line is available on the official website of the NBS.

Data on absolute poverty are available in the NBS Statistical Database, Social Statistics domain, Living Standards of the Population section, subsection Poverty and inequality.

 Useful references on the Multidimensional Poverty Index:

• Metadata for UN SDG indicators
• Multidimensional poverty and the Alkire-Foster (AF) method
• Technical introduction to the AF method
• Global Multidimensional Poverty Index
• Multidimensional Poverty Peer Network (MPPN)
• MPPN Some National Measures