A double constraint to development: how multidimensional poverty interacts with vulnerability to climate change

Abstract

Moving beyond income-based poverty measures, this paper provides an exploratory analysis of the relationship between climate change vulnerability and multidimensional poverty, aiming to identify the key non-monetary deprivations faced by the poor in the most vulnerable areas and to inform policy priorities. Using harmonized data from the Global Multidimensional Poverty Index and the ND-GAIN Vulnerability Index for a sample of 85 countries, we describe patterns of co-occurrence between poverty and vulnerability, showing that a disproportionate share of the poor live in highly vulnerable countries. The most prominent deprivations in these contexts relate to living conditions, particularly access to cooking fuel, sanitation, electricity, and housing. These findings suggest that targeted interventions in these sectors could be prioritized in highly vulnerable contexts to address multidimensional poverty more effectively. We also document that the combination of adverse climate events and high vulnerability is associated with higher poverty levels, with the nature of the event influencing the pattern: for example, droughts, as slow-onset events, are more strongly associated with elevated poverty indicators. Moreover, higher institutional quality, measured through government effectiveness, appears to moderate these patterns, with countries exhibiting better governance showing relatively lower associations between vulnerability and multidimensional poverty. Overall, the results indicate that multidimensional poverty and climate vulnerability are closely interconnected, highlighting the importance of considering both dimensions jointly in the design of adaptation and poverty reduction strategies.