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Revisiting poverty and welfare dominance

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  • Gian Maria Tomat

    ()
    (Bank of Italy)

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    Abstract

    The paper reviews the theory of the measurement of poverty. The axiomatic theory is described and the axiomatic properties of poverty indexes are related to assumptions on the functional form of the poverty index function. The notion of poverty ordering is then introduced and followed by a review of the relations between the poverty orderings than can be defined from classes of poverty index functions with well-defined functional form properties and the notions of first order and second order stochastic dominance. The analysis applies the results used in the theory of economic inequality to study the relationship between welfare orderings and Lorenz dominance. The theory is used to analyze poverty patterns in Italy in 1997-2005.

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    File URL: http://www.bancaditalia.it/pubblicazioni/econo/temidi/td07/td651_07/td651/en_tema_651.pdf
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    Bibliographic Info

    Paper provided by Bank of Italy, Economic Research and International Relations Area in its series Temi di discussione (Economic working papers) with number 651.

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    Date of creation: Nov 2007
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    Handle: RePEc:bdi:wptemi:td_651_07

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    Related research

    Keywords: economic inequality; poverty; poverty ordering; stochastic dominance;

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