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A Subjective Well-being Equivalence Scale for Mexico: Estimation and Poverty and Income-distribution Implications

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  • Mariano Rojas

Abstract

The estimation of equivalence scales is crucial in cases where a well-being comparison of persons living under different household arrangements is needed: for example, to identify the poor, to calculate poverty rates and to estimate income inequality. In spite of the importance of equivalence scales for economic policy, there is little theoretical guidance on their estimation, and most empirical studies have been carried out in developed countries. Traditional estimation methods have been criticized because of their limitations for making welfare comparisons. This paper uses a subjective well-being approach to estimate equivalence scales. The approach provides an equivalence scale founded on economic satisfaction, which can be used to make welfare comparisons for persons living under different household arrangements—for example, in households of different sizes and with different age composition of household members. The empirical study has been carried out for Mexico using a large database. The implications of the subjective well-being scale for the assessment of poverty and income inequality in Mexico are shown on the basis of a national survey and by comparison with alternative scales.

Suggested Citation

  • Mariano Rojas, 2007. "A Subjective Well-being Equivalence Scale for Mexico: Estimation and Poverty and Income-distribution Implications," Oxford Development Studies, Taylor & Francis Journals, vol. 35(3), pages 273-293.
  • Handle: RePEc:taf:oxdevs:v:35:y:2007:i:3:p:273-293
    DOI: 10.1080/13600810701514845
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    References listed on IDEAS

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    1. Gerdtham, Ulf-G & Sundberg, Gun, 1996. "Measuring Income-Related Health Inequalities in Sweden," SSE/EFI Working Paper Series in Economics and Finance 120, Stockholm School of Economics.
    2. John Creedy & Catherine Sleeman, 2004. "Adult Equivalence Scales, Inequality and Poverty in New Zealand," Treasury Working Paper Series 04/21, New Zealand Treasury.
    3. Charlier, E., 1997. "Equivalence Scales for the Former West Germany," Discussion Paper 1997-74, Tilburg University, Center for Economic Research.
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    Cited by:

    1. Mariano Rojas, 2010. "Intra-Household Arrangements and Economic Satisfaction," Journal of Happiness Studies, Springer, vol. 11(2), pages 225-241, April.
    2. Florian Wendelspiess Chávez Juárez, 2015. "Intergenerational transmission of education: the relative importance of transmission channels," Latin American Economic Review, Springer;Centro de Investigaciòn y Docencia Económica (CIDE), vol. 24(1), pages 1-44, December.
    3. repec:spr:jhappi:v:19:y:2018:i:1:d:10.1007_s10902-016-9799-9 is not listed on IDEAS
    4. repec:spr:elcore:v:17:y:2017:i:3:d:10.1007_s10660-016-9223-x is not listed on IDEAS
    5. Knabe, Andreas & Borah, Melanie & Kuhställer, Carina, 2016. "Reference Income Effects in the Determination of Equivalence Scales Using Income Satisfaction Data," Annual Conference 2016 (Augsburg): Demographic Change 145545, Verein für Socialpolitik / German Economic Association.
    6. Ravallion, Martin, 2012. "Poor, or just feeling poor ? on using subjective data in measuring poverty," Policy Research Working Paper Series 5968, The World Bank.
    7. Fremstad, Anders & Underwood, Anthony & Zahran, Sammy, 2018. "The Environmental Impact of Sharing: Household and Urban Economies in CO2 Emissions," Ecological Economics, Elsevier, vol. 145(C), pages 137-147.
    8. Han-Jen Niu, 0. "Cyber purchasing behavior of adolescents: family communication relationships and parental influence," Electronic Commerce Research, Springer, vol. 0, pages 1-25.
    9. repec:spr:laecrv:v:24:y:2015:i:1:p:1-44 is not listed on IDEAS
    10. Florian Wendelspiess Chávez Juárez, 2011. "Intergenerational transmission of education - Uncovering the mechanisms behind high intergenerational correlations," Working Papers 234, ECINEQ, Society for the Study of Economic Inequality.

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