Developing Deprivation Index for Children Taking into Account of Adaptive Preferences

The objective of this paper is 1) to develop child deprivation index using data collected from children themselves, and 2) to access if deprivation indexes which take into account of adaptive preference are better suited in measuring child deprivation than traditional deprivation indexes. Child deprivation index using data collected from children themselves has some advantages because child utility and his/her perception of it might be different from the perception by the parent. The paper also investigates “adaptive preference” of children. Possibility of adaptive preference has been pointed out in numerous literature early on, but whether children also exhibit “adaptive preference” behavior is still up to debate. This paper adds an evidence of adaptive preference among poor children and suggest modifications to the traditional material deprivation index, using child answered survey data from children living in metropolitan Tokyo. From the analysis, there are some evidences that “adaptive preference” behavior is present among 13 year-old children. Furthermore, the analysis shows that the “adaptive preference” is not seen in all items, and not among younger children. Such result suggests that while selecting items to be included in the deprivation index, it may be wise to treat items with high degree of “adaptive preference” differently from the items without “adaptive preference”. However, the analysis shows such modified indexes do show higher consistency, but do not necessary predict child outcomes associated with child poverty better than the traditional one.