Héctor H. Sandoval (Consejo Nacional de Evaluación de la Política de Desarrollo Social) Carlos M. Urzúa () (Tecnológico de Monterrey, Campus Ciudad de México)
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This note warns about the careless computation of poverty indexes when the welfare of each household is measured by its net income, since this can be negative. As is illustrated in the case of Mexico, even if only a handful of households report negative incomes, the resulting poverty aggregates, when they go beyond a mere headcount measure, can behave rather badly. The note ends with suggestions on how to deal with the problem.
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Find related papers by JEL classification: I32 - Health, Education, and Welfare - - Welfare and Poverty - - - Measurement and Analysis of Poverty C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Microeconomic Data
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