Until recently, most economists have resisted a seemingly obvious solution, namely to ask people themselves: “Do you feel poor?” . . .. . . [T]he idea of a “social subjective poverty line” (below which people tend to think they are poor, but above which they do not) is arguably the most conceptually appealing way of defining poverty.
The paper provides a good discussion on how this framework would deal with the difference between absolute and relative poverty. One of my concerns is if the very poor would be able to understand the questions. Think about an indigenous person who does not speak English, or Spanish, but speaks Ticuna or Quiché -- there are some issues of translation, some concepts or categories might not translate well into some indigenous languages, and even into Mandarin, for example. I like Ravallion's approach but I think he should team up with some (economic) anthropologist or linguists to get the most out of this approach.