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The effects of disasters on income mobility: Bootstrap inference and measurement error simulations

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Author Info
Espen Villanger

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Abstract

We evaluate the impact of disasters on income mobility by drawing on "natural experiments". While the poor have a much higher probability of remaining poor when entering a crisis compared to normal times, there is also a negative effect in the year after. Richer households seem to be unaffected. A simple bootstrap method is proposed to facilitate statistical inference for mobility matrices. Also, we simulate measurement error to illustrate its magnitude on these matrices. Small errors induce a substantial downward bias of the probability of remaining poor, while comp arisons across states seem more robust, which is promising for impact analysis.

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Paper provided by CMI (Chr. Michelsen Institute), Bergen, Norway in its series CMI Working Papers with number WP 2003:6.

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Length: 40 pages
Date of creation: 2003
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Handle: RePEc:chm:wpaper:wp2003-6

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Related research
Keywords: Income mobility Effects of disasters Bootstrap Measurement error Simulations Natural experiments Control group Treatment group Poverty;

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Biewen, Martin, 2002. "Bootstrap inference for inequality, mobility and poverty measurement," Journal of Econometrics, Elsevier, vol. 108(2), pages 317-342, June. [Downloadable!] (restricted)
  2. Alderman, Harold & Paxson, Christina H & DEC, 1992. "Do the poor insure? A synthesis of the literature on risk and consumption in developing countries," Policy Research Working Paper Series 1008, The World Bank. [Downloadable!]
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  3. Bourguignon, F. & Morrisson, C. & Atkinson, A.B., 1991. "Empirical Studies of Earnings Mobility," DELTA Working Papers 91-14, DELTA (Ecole normale supérieure).
  4. Bound, John & Krueger, Alan B, 1991. "The Extent of Measurement Error in Longitudinal Earnings Data: Do Two Wrongs Make a Right?," Journal of Labor Economics, University of Chicago Press, vol. 9(1), pages 1-24, January. [Downloadable!] (restricted)
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  5. Parker, Simon C. & Gardner, Sam, 2002. "International income mobility," Economics Letters, Elsevier, vol. 76(2), pages 179-187, July. [Downloadable!] (restricted)
  6. Ravallion, Martin, 1988. "Expected Poverty under Risk-Induced Welfare Variability," Economic Journal, Royal Economic Society, vol. 98(393), pages 1171-82, December. [Downloadable!] (restricted)
  7. Osberg, L & Xu, K, 1997. "International Comparisons of Poverty Intensity : Index Decomposition and Bootstrap Inference," Department of Economics at Dalhousie University working papers archive 97-03, Dalhousie, Department of Economics.
  8. Adams, Richard H. Jr. & He, Jane J., 1995. "Sources of income inequality and poverty in rural Pakistan:," Research reports 102, International Food Policy Research Institute (IFPRI). [Downloadable!]
  9. Rendtel, Ulrich & Langeheine, Rolf & Berntsen, Roland, 1998. "The Estimation of Poverty Dynamics Using Different Measurements of Household Income," Review of Income and Wealth, Blackwell Publishing, vol. 44(1), pages 81-98, March.
  10. Lipton, Michael & Ravallion, Martin, 1995. "Poverty and policy," Handbook of Development Economics, in: Hollis Chenery† & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 41, pages 2551-2657 Elsevier. [Downloadable!] (restricted)
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  11. Morduch, Jonathan, 1999. "Between the State and the Market: Can Informal Insurance Patch the Safety Net?," World Bank Research Observer, Oxford University Press, vol. 14(2), pages 187-207, August. [Downloadable!]
  12. Besley, Timothy, 1995. "Savings, credit and insurance," Handbook of Development Economics, in: Hollis Chenery† & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 36, pages 2123-2207 Elsevier. [Downloadable!] (restricted)
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  13. Lanjouw, Peter & Ravallion, Martin, 1995. "Poverty and Household Size," Economic Journal, Royal Economic Society, vol. 105(433), pages 1415-34, November. [Downloadable!] (restricted)
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  14. Mills, Jeffrey A & Zandvakili, Sourushe, 1997. "Statistical Inference via Bootstrapping for Measures of Inequality," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 12(2), pages 133-50, March-Apr. [Downloadable!]
  15. Alderman, Harold & Garcia, Marito, 1993. "Poverty, household food security, and nutrition in rural Pakistan:," Research reports 96, International Food Policy Research Institute (IFPRI). [Downloadable!]
  16. Foster, Andrew D, 1995. "Prices, Credit Markets and Child Growth in Low-Income Rural Areas," Economic Journal, Royal Economic Society, vol. 105(430), pages 551-70, May. [Downloadable!] (restricted)
  17. Frank A. Cowell & Maria-Pia Victoria-Feser, 2002. "Welfare Rankings in the Presence of Contaminated Data," Econometrica, Econometric Society, vol. 70(3), pages 1221-1233, May. [Downloadable!] (restricted)
  18. Morduch, J., 1995. "Poverty and Vulnerability," Papers 477, Harvard - Institute for International Development.
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Odd-Helge Fjeldstad, 2003. "What has trust got to do with it? Non-payment of service charges in local authorities in South Africa," CMI Working Papers WP 2003:12, CMI (Chr. Michelsen Institute), Bergen, Norway. [Downloadable!]
  2. Odd-Helge Fjeldstad & Florida Henjewele & Geoffrey Mwambe & Erasto Ngalewa & Knut Nygaard, 2004. "Local government finances and financial management in Tanzania," CMI Working Papers WP 2004: 7, CMI (Chr. Michelsen Institute), Bergen, Norway. [Downloadable!]
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