Accounting for Regional Poverty Differences in Croatia: Exploring the Role of Disparities in Average Income and Inequality
AbstractThe prevalence of poverty in a given population is determined by both the level of average income and the shape of income distribution. Accordingly, the difference in poverty between two populations can be attributed to disparities in their average incomes and in the levels of income inequality. In this paper, we decompose the differences in relative poverty between each of the twenty-one Croatian counties and Croatia as a whole into the contributions of the mean income and income inequality, using the Household Budget Survey data for 2010. The decomposition framework that we utilize here is one usually applied for decompositions of intertemporal poverty changes, and is based on the concept of Shapley value from cooperative game theory. Poverty is measured by three conventional measures – the headcount ratio, the poverty gap, and the squared poverty gap – and robustness of the results to switching from one measure to another is discussed. The results of decompositions show that in most cases both the mean income and inequality differences contribute to poverty variation across the counties, relative to poverty in Croatia as a whole. When poverty is measured by the headcount ratio, the income contribution dominates the inequality contribution, while when we switch to the other two measures, which give more weight to the poorer among the poor, the inequality contribution starts to dominate.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by The Institute of Economics, Zagreb in its series Working Papers with number 1301.
Length: 36 pages
Date of creation: Jan 2013
Date of revision:
regional poverty; decomposition; income contribution; inequality contribution; Shapley value; Croatia;
Find related papers by JEL classification:
- D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
- I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
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.:
- Deutsch, Joseph & Silber, Jacques, 2011.
"On various ways of measuring pro-poor growth,"
Economics Discussion Papers
2011-13, Kiel Institute for the World Economy.
- Deutsch, Joseph & Silber, Jacques, 2011. "On various ways of measuring pro-poor growth," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 5(13), pages 1-57.
- Florent Bresson, 2008. "The estimation of the growth and redistribution components of changes in poverty: a reassessment," Economics Bulletin, AccessEcon, vol. 9(14), pages 1-7.
- Zhang, Yin & Wan, Guanghua, 2006.
"The Impacts of Growth and Inequality on Rural Poverty in China,"
Working Paper Series
RP2006/94, World Institute for Development Economic Research (UNU-WIDER).
- Zhang, Yin & Wan, Guanghua, 2006. "The impact of growth and inequality on rural poverty in China," Journal of Comparative Economics, Elsevier, vol. 34(4), pages 694-712, December.
- repec:ebl:ecbull:v:9:y:2008:i:19:p:1-2 is not listed on IDEAS
- L. R. Jain & Suresh D. Tendulkar, 1990. "Role of Growth and Distribution in the Observed Change in Headcount Ratio Measure of Poverty: A Decomposition Exercise for India," Indian Economic Review, Department of Economics, Delhi School of Economics, vol. 25(2), pages 165-205, July.
- Kolenikov, Stanislav & Shorrocks, Anthony, 2003.
"A Decomposition Analysis of Regional Poverty in Russia,"
Working Paper Series
UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
- Stanislav Kolenikov & Anthony Shorrocks, 2005. "A Decomposition Analysis of Regional Poverty in Russia," Review of Development Economics, Wiley Blackwell, vol. 9(1), pages 25-46, 02.
- Francis Menjo Baye, 2006. "Growth, Redistribution and Poverty Changes in Cameroon: A Shapley Decomposition Analysis," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 15(4), pages 543-570, December.
- Paolo Verme, 2006. "Pro-poor Growth during Exceptional Growth. Evidence from a Transition Economy," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 3(1), pages 3-14, June.
- Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, vol. 52(3), pages 761-66, May.
- repec:ebl:ecbull:v:9:y:2008:i:14:p:1-7 is not listed on IDEAS
- Sergiu Hart, 2006. "Shapley Value," Discussion Paper Series dp421, The Center for the Study of Rationality, Hebrew University, Jerusalem.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Doris Banicevic).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.