We contribute to the literature on multidimensional poverty and people with disabilities by developing a group-specific, comprehensive, and policy-relevant measure of multidimensional poverty adapted to exploring deprivations within the group of persons with disabilities in Peru. Based on the Alkire and Foster (2011) method, we calculated multidimensional poverty estimates using data from the first Specialised National Survey on Disability in Peru collected in 2012. Our measure included eight dimensions, four of which were operationalised using disability-specific indicators, of which, in turn, three involved deprivation criteria specific to different categories of disability. Our results showed that 41.1% of the population with disabilities in Peru suffer deprivations in at least three out of the eight dimensions, whereas rural populations, women, indigenous peoples, persons with severe disabilities, and persons with communication disabilities face the highest levels of poverty. Additionally, we identified rural indigenous women as the poorest subgroup within the overall group of persons with disabilities in Peru with a poverty incidence of 88.1%. Our results suggested that eradicating multidimensional poverty among persons with disabilities in Peru will involve implementing reasonable accommodations to existing policies and creating new disability-specific policies focused on the poorest subgroups within this population.

The number of people in low- and middle-income countries who suffer from depression is increasing, and a significant proportion of people in these countries live in poverty. We estimated the effect of living in multidimensional poverty on experiencing symptoms associated with major depression using the 2018 Peruvian Demographic and Health Survey. We used an instrumental variables approach to overcome the potential endogeneity bias caused by the simultaneous relationship between multidimensional poverty and depression. We found that living in multidimensional poverty significantly increases depression symptom severity. This has urgent policy implications for low- and middle-income countries with limited provision of mental health services.

We introduce a comprehensive policy-relevant measure of multidimensional wellbeing conceptually rooted in Amartya Sen’s capability approach and applied to a middle-income country: the Multidimensional Wellbeing Index for Peru (MWI-P). We design and collect a specialized survey in Peru in late 2018, which included data on wellbeing achievements across 12 dimensions, on the value that respondents place upon each of these dimensions, and on self-perceived freedom. Then, we utilize this information to set the weighting structure and select a wellbeing sufficiency threshold for the MWI-P, which we estimate using the capability-inspired Alkire–Foster method. Our results show that only 45.9% of the sample population live above the wellbeing threshold, which involves achieving sufficiency in at least seven out of the 12 weighted dimensions of the MWI-P. Subgroup analyses reveal that rural populations, women, and older adults are at a disadvantage compared with urban populations, men, and younger adults, respectively. These subgroups’ disparities hold valid if we introduce changes in the weighting structure or in the wellbeing sufficiency threshold. We argue that the MWI-P can inspire other low- and middle-income countries to reorient post-pandemic recovery policies from a focus on economic growth to a human flourishing approach based on what people value. Supplementary Information The online version contains supplementary material available at 10.1007/s11482-022-10064-w.