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How reliable are household expenditures as a proxy for permanent income? Implications for the income–nutrition relationship

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  • Gibson, John
  • Kim, Bonggeun

Abstract

Using short-run expenditures from household surveys as a proxy may create attenuated estimates of the impact of permanent income on economic outcomes. We use repeated observations to calculate reliability ratios and estimate errors in variables regressions of the impact of income on nutrition. We find significant responses to income, in contrast to previous influential studies.

Suggested Citation

  • Gibson, John & Kim, Bonggeun, 2013. "How reliable are household expenditures as a proxy for permanent income? Implications for the income–nutrition relationship," Economics Letters, Elsevier, vol. 118(1), pages 23-25.
  • Handle: RePEc:eee:ecolet:v:118:y:2013:i:1:p:23-25
    DOI: 10.1016/j.econlet.2012.09.016
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    References listed on IDEAS

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    1. Behrman, Jere R & Deolalikar, Anil B, 1987. "Will Developing Country Nutrition Improve with Income? A Case Study for Rural South India," Journal of Political Economy, University of Chicago Press, vol. 95(3), pages 492-507, June.
    2. Beegle, Kathleen & De Weerdt, Joachim & Friedman, Jed & Gibson, John, 2012. "Methods of household consumption measurement through surveys: Experimental results from Tanzania," Journal of Development Economics, Elsevier, vol. 98(1), pages 3-18.
    3. Subramanian, Shankar & Deaton, Angus, 1996. "The Demand for Food and Calories," Journal of Political Economy, University of Chicago Press, vol. 104(1), pages 133-162, February.
    4. McKenzie, David, 2012. "Beyond baseline and follow-up: The case for more T in experiments," Journal of Development Economics, Elsevier, vol. 99(2), pages 210-221.
    5. Bouis, Howarth E. & Haddad, Lawrence J., 1992. "Are estimates of calorie-income fxelasticities too high? : A recalibration of the plausible range," Journal of Development Economics, Elsevier, vol. 39(2), pages 333-364, October.
    6. Behrman, Jere R. & Wolfe, Barbara L., 1984. "More evidence on nutrition demand : Income seems overrated and women's schooling underemphasized," Journal of Development Economics, Elsevier, vol. 14(1), pages 105-128.
    7. Timothy J. Halliday, 2010. "Mismeasured Household Size and its Implications for the Identification of Economies of Scale," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 72(2), pages 246-262, April.
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    Cited by:

    1. repec:eee:jfpoli:v:72:y:2017:i:c:p:94-111 is not listed on IDEAS
    2. John Gibson, 2016. "Measuring Chronic Hunger from Diet Snapshots: Why 'Bottom up' Survey Counts and 'Top down' FAO Estimates Will Never Meet," Working Papers in Economics 16/07, University of Waikato.

    More about this item

    Keywords

    Income; Measurement error; Nutrition;

    JEL classification:

    • C2 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables
    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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