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Measuring inequalities: do household surveys paint a realistic picture?

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  • Guénard, Charlotte
  • Mesplé-Somps, Sandrine

Abstract

The paper addresses the issue of the accuracy of standard-of-living measurements using household survey data. First, it highlights the fact that lighter data collection processes in some developing countries have added to measurement errors in consumption and income aggregates measurement errors. The paper reasserts the need to apply reference guidelines to the measurement of household consumption in order to compute comparable distribution indicators across countries and over time. Second, it contends that it is hard to analyze inequality solely from consumption patterns without taking income and savings into account. Two solutions are proposed for the correction of income measurement errors: by using savings declarations and by implementing a multiple imputation procedure. The results are based on a careful analysis of the EPM93 survey of Madagascar whose design is quite close to the LSMS household surveys, and the ENV98 survey of Côte d'Ivoire representative of surveys conducted nowadays in most Sub-Saharan African countries.

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File URL: http://basepub.dauphine.fr/xmlui/bitstream/123456789/5143/1/measuring_inqualities.PDF
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Bibliographic Info

Paper provided by Paris Dauphine University in its series Economics Papers from University Paris Dauphine with number 123456789/5143.

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Date of creation: 2010
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Publication status: Published in Review of Income and Wealth, 2010, Vol. 56, no. 3. pp. 519-538.Length: 19 pages
Handle: RePEc:dau:papers:123456789/5143

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Related research

Keywords: household survey; inequality; missing data;

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References

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  1. T. Paul Schultz, 1998. "Inequality in the distribution of personal income in the world: How it is changing and why," Journal of Population Economics, Springer, vol. 11(3), pages 307-344.
  2. Chesher, Andrew & Schluter, Christian, 2002. "Welfare Measurement and Measurement Error," Review of Economic Studies, Wiley Blackwell, vol. 69(2), pages 357-78, April.
  3. Angus Deaton, 2004. "Measuring poverty in a growing world (or measuring growth in a poor world)," Working Papers 178, Princeton University, Woodrow Wilson School of Public and International Affairs, Research Program in Development Studies..
  4. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
  5. Angus Deaton & Salman Zaidi, 1999. "Guidelines for Constructing Consumption Aggregates For Welfare Analysis," Working Papers 217, Princeton University, Woodrow Wilson School of Public and International Affairs, Research Program in Development Studies..
  6. T. Paul Schultz, 1998. "Inequality in the Distribution of Personal Income in the World: How it is Changing and Why," Working Papers 784, Economic Growth Center, Yale University.
  7. Chen, Shaohua & Ravallion, Martin, 2004. "How Have the World's Poorest Fared Since the Early 1980s?," Policy Research Working Paper Series 3341, The World Bank.
  8. Angus Deaton, 2005. "ERRATUM: Measuring Poverty in a Growing World (or Measuring Growth in a Poor World)," The Review of Economics and Statistics, MIT Press, vol. 87(2), pages 395-395, May.
  9. Mistiaen, Johan A. & Ravallion, Martin, 2003. "Survey compliance and the distribution of income," Policy Research Working Paper Series 2956, The World Bank.
  10. Angus Deaton & Valerie Kozel, 2005. "Data and Dogma: The Great Indian Poverty Debate," World Bank Research Observer, World Bank Group, vol. 20(2), pages 177-199.
  11. Appleton, Simon, 2003. "Regional or National Poverty Lines? The Case of Uganda in the 1990s," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
  12. de Mel, Suresh & McKenzie, David & Woodruff, Christopher, 2007. "Measuring microenterprise profits : don't ask how the sausage is made," Policy Research Working Paper Series 4229, The World Bank.
  13. Lillard, Lee & Smith, James P & Welch, Finis, 1986. "What Do We Really Know about Wages? The Importance of Nonreporting and Census Imputation," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages 489-506, June.
  14. Gibson, John & Huang, Jikun & Rozelle, Scott, 2001. "Improving Estimates Of Inequality And Poverty From Urban China'S Household Income And Expenditure Survey," Working Papers 11989, University of California, Davis, Department of Agricultural and Resource Economics.
  15. Christian Loisy, 1999. "L'épargne des ménages de 1984 à 1995 : disparité et diversité," Économie et Statistique, Programme National Persée, vol. 324(1), pages 113-133.
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Cited by:
  1. Derek Yu, 2013. "Some factors influencing the comparability and reliability of poverty estimates across household surveys," Working Papers 03/2013, Stellenbosch University, Department of Economics.

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