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Nonparametric bounds on equivalence scales

Author

Listed:
  • Christian Dudel

    (Ruhr-Universitaet Bochum)

Abstract

Methods for estimating equivalence scales usually rely on rather strong identifying assumptions. This note considers nonparametric bounds on equivalence scales derived from the potential outcomes framework and uses nonparametric methods for estimation, which requires only mild assumptions. The method yields only lower and upper bounds of equivalence scales rather than point estimates. The results of an analysis using German expenditure data show that the range implied by these bounds is rather wide.

Suggested Citation

  • Christian Dudel, 2015. "Nonparametric bounds on equivalence scales," Economics Bulletin, AccessEcon, vol. 35(4), pages 2161-2165.
    • Handle: RePEc:ebl:ecbull:eb-15-00500
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    File URL: http://www.accessecon.com/Pubs/EB/2015/Volume35/EB-15-V35-I4-P218.pdf
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    References listed on IDEAS

    as
    1. Johannes Schwarze, 2003. "Using Panel Data on Income Satisfaction to Estimate Equivalence Scale Elasticity," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 49(3), pages 359-372, September.
    2. Jürgen Faik, 2011. "Der Zerlegungs-Ansatz – ein alternativer Vorschlag zur Messung von Armut," AStA Wirtschafts- und Sozialstatistisches Archiv, Springer;Deutsche Statistische Gesellschaft - German Statistical Society, vol. 4(4), pages 293-315, January.
    3. Szulc, Adam, 2009. "A matching estimator of household equivalence scales," Economics Letters, Elsevier, vol. 103(2), pages 81-83, May.
    4. Guido W. Imbens, 2004. "Nonparametric Estimation of Average Treatment Effects Under Exogeneity: A Review," The Review of Economics and Statistics, MIT Press, vol. 86(1), pages 4-29, February.
    5. Hayfield, Tristen & Racine, Jeffrey S., 2008. "Nonparametric Econometrics: The np Package," Journal of Statistical Software, Foundation for Open Access Statistics, vol. 27(i05).
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Christian Dudel & Julian Schmied, 2019. "Pension adequacy standards: an empirical estimation strategy and results for the United States and Germany," MPIDR Working Papers WP-2019-003, Max Planck Institute for Demographic Research, Rostock, Germany.
    2. Christian Dudel & Jan Marvin Garbuszus & Julian Schmied, 2021. "Assessing differences in household needs: a comparison of approaches for the estimation of equivalence scales using German expenditure data," Empirical Economics, Springer, vol. 60(4), pages 1629-1659, April.
    3. Christian Dudel & Julian Schmied, 2023. "Pension benchmarks: empirical estimation and results for the United States and Germany," Fiscal Studies, John Wiley & Sons, vol. 44(2), pages 171-188, June.

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    More about this item

    Keywords

    Household equivalence scales; Nonparametric bounds;

    JEL classification:

    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General
    • D1 - Microeconomics - - Household Behavior

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