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Indigenous and Other Australian Poverty: Revisiting the Importance of Equivalence Scales

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  • BOYD H. HUNTER
  • STEVEN KENNEDY
  • NICHOLAS BIDDLE

Abstract

Equivalence scales attempt to control for family size and composition, as well as the relative costs of maintaining various family types. The 1995 National Health Survey is used to examine how variations in the assumptions underlying equivalence scales, such as household composition and economies of size, affect poverty measures for Indigenous and non-Indigenous Australians. The main finding is that the assumptions about the costs of children can increase Indigenous poverty by a factor of two- and-a-half. Another finding is that the choice of equivalence scales can induce large threshold effects that influence the composition of poverty. Copyright © 2004 Economic Society of Australia..

Suggested Citation

  • Boyd H. Hunter & Steven Kennedy & Nicholas Biddle, 2004. "Indigenous and Other Australian Poverty: Revisiting the Importance of Equivalence Scales," The Economic Record, The Economic Society of Australia, vol. 80(251), pages 411-422, December.
  • Handle: RePEc:bla:ecorec:v:80:y:2004:i:251:p:411-422
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    References listed on IDEAS

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    6. Parsell, Bruce F & Powell, Alan A & Wilcoxen, Peter J, 1991. "The Effects of Fiscal Restraint on the Australian Economy as Projected by the Murphy and MSG2 Models: A Comparison," The Economic Record, The Economic Society of Australia, pages 97-114.
    7. Dixon, Peter B. & Parmenter, B. R. & Powell, Alan A., 1984. "The role of miniatures in computable general equilibrium modelling : Experience from ORANI," Economic Modelling, Elsevier, pages 421-428.
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    Cited by:

    1. Regier, Gregory & Zereyesus, Yacob & Dalton, Timothy & Amanor-Boadu, Vincent, 2015. "Do Adult Equivalence Scales Matter in Poverty Estimates? A Ghana Case Study," 2015 Conference, August 9-14, 2015, Milan, Italy 212487, International Association of Agricultural Economists.
    2. Judith Streak & Derek Yu & Servaas Van der Berg, 2009. "Measuring Child Poverty in South Africa: Sensitivity to the Choice of Equivalence Scale and an Updated Profile," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, pages 183-201.
    3. Breunig, Robert & Hasan, Syed & Hunter, Boyd, 2017. "Financial Stress and Indigenous Australians," IZA Discussion Papers 11221, Institute for the Study of Labor (IZA).
    4. repec:spr:soinre:v:132:y:2017:i:3:d:10.1007_s11205-016-1335-0 is not listed on IDEAS
    5. Udo Ebert, 2008. "Equity-regarding poverty measures: Differences in needs and the role of equivalence scales," LIS Working papers 508, LIS Cross-National Data Center in Luxembourg.
    6. Udo Ebert, 2010. "Equity-regarding poverty measures: differences in needs and the role of equivalence scales," Canadian Journal of Economics, Canadian Economics Association, vol. 43(1), pages 301-322, February.

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