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Measuring Chronic Poverty

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  • Maria Emma Santos
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    Abstract

    A new class of chronic poverty measures is constructed that builds upon Jalan and Ravallion (1998) but does not require resources in different periods to be perfect substitutes when identifying the chronically poor. We use a general mean to combine the resources of a person into a permanent income standard that is then compared to a poverty line to determine when a person is chronically poor. The parameter of the general mean allows for varying degrees of substitutability over time. The decomposable Clark, Hemming and Ulph (1981) poverty measure is applied to the distribution of permanent income standards to measure overall chronic poverty. Each measure has a convenient expression in terms of a censored matrix and satisfies a host of properties including decomposability. We provide an empirical application of the new measures using panel data from urban areas in Argentina.

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    Bibliographic Info

    Paper provided by Queen Elizabeth House, University of Oxford in its series OPHI Working Papers with number ophiwp052.

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    Date of creation: Aug 2012
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    Handle: RePEc:qeh:ophiwp:ophiwp052

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    1. Carlos Gradín & Coral Del Río & Olga Cantó, 2012. "Measuring Poverty Accounting For Time," Review of Income and Wealth, International Association for Research in Income and Wealth, International Association for Research in Income and Wealth, vol. 58(2), pages 330-354, 06.
    2. Guillermo Cruces & Quentin Wodon, 2003. "Risk-adjusted poverty in Argentina: measurement and determinants," LSE Research Online Documents on Economics, London School of Economics and Political Science, LSE Library 6550, London School of Economics and Political Science, LSE Library.
    3. Sen, Amartya K, 1976. "Poverty: An Ordinal Approach to Measurement," Econometrica, Econometric Society, Econometric Society, vol. 44(2), pages 219-31, March.
    4. Jalan, Jyotsna & Ravallion, Martin, 1998. "Transient Poverty in Postreform Rural China," Journal of Comparative Economics, Elsevier, vol. 26(2), pages 338-357, June.
    5. BOSSERT, Walter & CHAKRAVARTY, Satya R. & D’AMBROSIO, Conchita, 2008. "Poverty and Time," Cahiers de recherche, Centre interuniversitaire de recherche en économie quantitative, CIREQ 05-2008, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
    6. Daria Mendola & Annalisa Busetta, 2012. "The Importance Of Consecutive Spells Of Poverty: A Path-Dependent Index Of Longitudinal Poverty," Review of Income and Wealth, International Association for Research in Income and Wealth, International Association for Research in Income and Wealth, vol. 58(2), pages 355-374, 06.
    7. Cesar Calvo & Stefan Dercon, 2007. "Chronic Poverty and All That: The Measurement of Poverty over Time," Economics Series Working Papers, University of Oxford, Department of Economics WPS/2007-04, University of Oxford, Department of Economics.
    8. Lillard, Lee A & Willis, Robert J, 1978. "Dynamic Aspects of Earning Mobility," Econometrica, Econometric Society, Econometric Society, vol. 46(5), pages 985-1012, September.
    9. Ravallion, Martin, 1988. "Expected Poverty under Risk-Induced Welfare Variability," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 98(393), pages 1171-82, December.
    10. James E. Foster & Miguel Székely, 2001. "Is Economic Growth Good for the Poor? Tracking Low Incomes Using General Means," Research Department Publications, Inter-American Development Bank, Research Department 4269, Inter-American Development Bank, Research Department.
    11. Hoy, Michael & Zheng, Buhong, 2011. "Measuring lifetime poverty," Journal of Economic Theory, Elsevier, Elsevier, vol. 146(6), pages 2544-2562.
    12. Joan R. Rodgers & John L. Rodgers, 1993. "Chronic Poverty in the United States," Journal of Human Resources, University of Wisconsin Press, University of Wisconsin Press, vol. 28(1), pages 25-54.
    13. Natalie Nairi Quinn & Catherine Porter, 2008. "Intertemporal Poverty Measurement: Tradeoffs and Policy Options," Economics Series Working Papers, University of Oxford, Department of Economics CSAE WPS/2008-21, University of Oxford, Department of Economics.
    14. Clark, Stephen & Hemming, Richard & Ulph, David, 1981. "On Indices for the Measurement of Poverty," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 91(362), pages 515-26, June.
    15. Alkire, Sabina & Foster, James, 2011. "Counting and multidimensional poverty measurement," Journal of Public Economics, Elsevier, Elsevier, vol. 95(7-8), pages 476-487, August.
    16. Jyotsna Jalan & Martin Ravallion, 2000. "Is transient poverty different? Evidence for rural China," Journal of Development Studies, Taylor & Francis Journals, Taylor & Francis Journals, vol. 36(6), pages 82-99.
    17. Mary Jo Bane & David T. Ellwood, 1986. "Slipping into and out of Poverty: The Dynamics of Spells," Journal of Human Resources, University of Wisconsin Press, University of Wisconsin Press, vol. 21(1), pages 1-23.
    18. A. Atkinson, 2003. "Multidimensional Deprivation: Contrasting Social Welfare and Counting Approaches," Journal of Economic Inequality, Springer, Springer, vol. 1(1), pages 51-65, April.
    19. Atkinson, Anthony B., 1970. "On the measurement of inequality," Journal of Economic Theory, Elsevier, Elsevier, vol. 2(3), pages 244-263, September.
    20. James E. Foster, 2007. "A Class of Chronic Poverty Measures," Vanderbilt University Department of Economics Working Papers, Vanderbilt University Department of Economics 0701, Vanderbilt University Department of Economics.
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    Cited by:
    1. Amanda Lenhardt & Andrew Shepherd, 2013. "What has happened to the poorest 50%?," Brooks World Poverty Institute Working Paper Series, BWPI, The University of Manchester 18413, BWPI, The University of Manchester.

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