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Can Subjective Questions on Economic Welfare Be Trusted?

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  • Martin Ravallion
  • Kristen Himelein
  • Kathleen Beegle

Abstract

While self-assessments of welfare have become popular for measuring poverty and estimating welfare effects, the methods can be deceptive given systematic heterogeneity in respondents’ scales. Little is known about this problem. We study scale heterogeneity using specially designed surveys in three countries: Tajikistan, Guatemala, and Tanzania. Respondents were asked to score stylized vignettes, as well as their own household. Diverse scales are in evidence, casting considerable doubt on the meaning of widely used summary measures such as subjective poverty rates. Nonetheless, under our identifying assumptions, only small biases are induced in the coefficients on widely used regressors for subjective poverty and welfare.

Suggested Citation

  • Martin Ravallion & Kristen Himelein & Kathleen Beegle, 2016. "Can Subjective Questions on Economic Welfare Be Trusted?," Economic Development and Cultural Change, University of Chicago Press, vol. 64(4), pages 697-726.
    • Handle: RePEc:ucp:ecdecc:doi:10.1086/686793
    DOI: 10.1086/686793
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    3. Van Landeghem, Bert & Vandeplas, Anneleen, 2018. "The relationship between status and happiness: Evidence from the caste system in rural India," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 77(C), pages 62-71.
    4. Zhiyong Huang & Haoxian Wang & Wenyuan Zheng, 2021. "An extended hierarchical ordered probit model robust to heteroskedastic vignette perceptions with an application to functional limitation assessment," PLOS ONE, Public Library of Science, vol. 16(3), pages 1-19, March.
    5. Jeffrey R. Bloem & Andrew J. Oswald, 2022. "The Analysis of Human Feelings: A Practical Suggestion for a Robustness Test," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 68(3), pages 689-710, September.
    6. DECANCQ Koen & OLIVERA Javier & SCHOKKAERT Erik, 2018. "Program evaluation and ethnic differences: the Pension 65 program in Peru," LISER Working Paper Series 2018-21, Luxembourg Institute of Socio-Economic Research (LISER).
    7. Micael Dahlen & Helge Thorbjørnsen, 2022. "Individuals’ Assessments of Their Own Wellbeing, Subjective Welfare, and Good Life: Four Exploratory Studies," IJERPH, MDPI, vol. 19(19), pages 1-10, September.
    8. Kaiser, Caspar, 2022. "Using memories to assess the intrapersonal comparability of wellbeing reports," Journal of Economic Behavior & Organization, Elsevier, vol. 193(C), pages 410-442.
    9. Bernard, Tanguy & Doss, Cheryl & Hidrobo, Melissa & Hoel, Jessica & Kieran, Caitlin, 2020. "Ask me why: Patterns of intrahousehold decision-making," World Development, Elsevier, vol. 125(C).
    10. Bert Van Landeghem & Anneleen Vandeplas, 2016. "Lower in rank, but happier: the complex relationship between status and happiness," Working Papers of LICOS - Centre for Institutions and Economic Performance 556194, KU Leuven, Faculty of Economics and Business (FEB), LICOS - Centre for Institutions and Economic Performance.
    11. Koen Decancq & Marc Fleurbaey & Erik Schokkaert, 2017. "Wellbeing Inequality and Preference Heterogeneity," Economica, London School of Economics and Political Science, vol. 84(334), pages 210-238, April.
    12. Christensen, Cheryl, 2018. "Progress and Challenges in Global Food Security," Amber Waves:The Economics of Food, Farming, Natural Resources, and Rural America, United States Department of Agriculture, Economic Research Service, vol. 0(01), February.
    13. Antonio M. Salcedo & Gregorio Izquierdo Llanes, 2019. "Drawing the optimal monetary poverty lines based on empirical data: an application to Spain," Quality & Quantity: International Journal of Methodology, Springer, vol. 53(1), pages 513-527, January.
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    15. Antonio M. Salcedo & Gregorio Izquierdo, 2018. "An Empirical Approach to the Poverty Indicators Based on Revealed Parameters: The Case of Spain," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 138(2), pages 623-638, July.
    16. Romina Boarini & Marc Fleurbaey & Fabrice Murtin & Paul Schreyer, 2022. "Well‐being during the Great Recession: new evidence from a measure of multi‐dimensional living standards with heterogeneous preferences," Scandinavian Journal of Economics, Wiley Blackwell, vol. 124(1), pages 104-138, January.
    17. Olukorede Abiona, 2017. "Adverse Effects of Early Life Extreme Precipitation Shocks on Short-term Health and Adulthood Welfare Outcomes," Review of Development Economics, Wiley Blackwell, vol. 21(4), pages 1229-1254, November.

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