Estimating Comparable Poverty Counts from Incomparable Surveys: Measuring Poverty in India

We develop a procedure to estimate poverty counts in India from the 55th Round of the Na- tional Sample Survey (NSS), a large household survey run in 1999-2000. The evidence suggests that a change in the survey design caused the reports on household expenditure to change to an extent that it is impossible, without adjustments, to compare poverty estimates from this survey with those obtained from previous NSS Rounds. More generally, the paper addresses the problem of comparing the distribution of a variable across differently designed surveys, when the different design causes the respondents' reports about the variable to be incomparable across the surveys. The proposed procedure requires only the existence of a set of auxiliary variables whose reports are not affected by the different survey design, and whose relation with the main variable of interest is stable across the surveys. The estimator, instead, does not require specific functional form assumptions on the relation between the main variable of interest and the auxiliary variable. In the context of NSS data, we identify a set of variables whose reports are not systematically affected by the changes implemented in the survey design, and we provide evidence of the stability over time of the distribution of per capita total expenditure conditional on these variables. We describe an experiment to evaluate the performance of the estimator, showing that it provides satisfactory results, both in the estimation of poverty counts and in the estimation of the density of per capita expenditure. Finally, we use our estimator to calculate adjusted estimates for poverty in India using data from the 1999-2000 NSS Survey. The results show a sharp reduction in poverty in the nineties, even if in rural areas the reduction is not as large as that implied by the unadjusted figures.