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Distribution-sensitivity of rank-dependent poverty measures

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  • Bosmans, K.G.M.

    (Microeconomics & Public Economics)

Abstract

We propose a criterion to rank poverty measures on the basis of distribution-sensitivity. The criterion compares reactions to ‘lossy’ transfers among the poor. We focus on the class of rank-dependent poverty measures and provide distribution-sensitivity rankings of the poverty gap ratio, the first and second Sen measures, the Thon measure, the Shorrocks measure, and the Thon, Kakwani and S-Gini classes of measures. Moreover, we discuss the relationship between the proposed criterion and two alternative distribution-sensitivity criteria based on the Arrow–Pratt theory of risk aversion. Finally, we provide an empirically tractable necessary and sufficient condition for unanimous poverty rankings by all continuous and replication invariant rank-dependent poverty measures that exhibit a predetermined minimum degree of distribution-sensitivity.
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  • Bosmans, K.G.M., 2012. "Distribution-sensitivity of rank-dependent poverty measures," Research Memorandum 034, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
    • Handle: RePEc:unm:umamet:2012034
    DOI: 10.26481/umamet.2012034
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