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Positional Concerns among the Poor: Does Reference Group Matter? Evidence from Survey Experiments

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  • Akay, Alpaslan

    ()
    (University of Gothenburg)

  • Andersson, Lisa

    ()
    (University of Gothenburg)

  • Martinsson, Peter

    ()
    (University of Gothenburg)

  • Medhin, Haileselassie

    ()
    (University of Gothenburg)

Abstract

Previous research suggests a lower degree of positional concerns among people from poor countries. Yet the evidence is limited and most often builds on the assumption that people’s reference groups are the same across all individuals. We conduct a survey experiment in urban Ethiopia that is modified to include multiplicity of reference groups. We estimate positional concerns considering various reference groups to test whether the low positional concerns found in the literature is due to misspecification of the reference groups. The results show a low degree of positional concern which is highly stable across different reference groups.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 8215.

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Length: 40 pages
Date of creation: May 2014
Date of revision:
Publication status: forthcoming in: Journal of African Economics, 2014
Handle: RePEc:iza:izadps:dp8215

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Keywords: reference groups; income comparison; experiment;

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