On the Measurement of Poverty Dynamics
This paper introduces a family of multi-period poverty measures derived from commonly used static poverty measures. Our measures trade-off poverty levels and changes (gains and losses) over time, and are consistent with loss aversion. We characterize the partial ranking over income dynamics induced by these measures and use it in two empirical applications with longitudinal household level data. Comparing two decades of income dynamics in the United States we find that the income dynamics of the 1990s -post Welfare reform- dominates the income dynamics of the 1980s -pre Welfare reform. Next, we compare the contemporary income dynamics of three industrialized countries and conclude that United Kingdom dominates Germany and United States, and Germany dominates the United States if poverty stocks are given more importance than poverty flows. The differences between our ranking and those obtained using other welfare criteria such as social mobility suggest that our measures capture critical information about the evolution of poverty.
|Date of creation:||Oct 2009|
|Date of revision:|
|Contact details of provider:|| Postal: 79 JFK Street, Cambridge, MA 02138|
Web page: http://www.ksg.harvard.edu/research/working_papers/index.htm
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Kareen Rozen, 2010.
"Foundations of Intrinsic Habit Formation,"
Econometric Society, vol. 78(4), pages 1341-1373, 07.
- Rozen, Kareen, 2008. "Foundations of Intrinsic Habit Formation," Working Papers 40, Yale University, Department of Economics.
- Kareen Rozen, 2008. "Foundations of Intrinsic Habit Formation," Cowles Foundation Discussion Papers 1642, Cowles Foundation for Research in Economics, Yale University.
- Kareen Rozen, 2008. "Foundations of Intrinsic Habit Formation," Cowles Foundation Discussion Papers 1642R, Cowles Foundation for Research in Economics, Yale University, revised Mar 2009.
- Kareen Rozen, 2008. "Foundations of Intrinsic Habit Formation," Levine's Working Paper Archive 122247000000002062, David K. Levine.
- Daniel Kahneman & Robert Sugden, 2005. "Experienced Utility as a Standard of Policy Evaluation," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 32(1), pages 161-181, 09.
- Bruce D. Meyer & James X. Sullivan, 2006. "Three Decades of Consumption and Income Poverty," Working Papers 0416, Harris School of Public Policy Studies, University of Chicago.
- Peter T. Gottschalk & Enrico Spolaore, 2000.
"On the Evaluation of Economic Mobility,"
JCPR Working Papers
185, Northwestern University/University of Chicago Joint Center for Poverty Research.
- Peter Gottschalk & Enrico Spolare, 2001. "On the Evaluation of Economic Mobility," Working Papers 2001-25, Brown University, Department of Economics.
- Peter Gottschalk & Enrico Spolaore, 2000. "On the Evaluation of Economic Mobility," Boston College Working Papers in Economics 459, Boston College Department of Economics, revised 09 Apr 2001.
- Peter Gottschalk & Enrico Spolaore, 1998. "On the Evaluation of Economic Mobility," Boston College Working Papers in Economics 407., Boston College Department of Economics.
- Thorbecke, Erik, 2004. "Conceptual and Measurement Issues in Poverty Analysis," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
- Botond Koszegi & Matthew Rabin, 2004.
"A Model of Reference-Dependent Preferences,"
Method and Hist of Econ Thought
- Botond Koszegi & Matthew Rabin, 2005. "A Model of Reference-Dependent Preferences," Levine's Bibliography 784828000000000341, UCLA Department of Economics.
- Koszegi, Botond & Rabin, Matthew, 2004. "A Model of Reference-Dependent Preferences," Department of Economics, Working Paper Series qt0w82b6nm, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
- Daniel Kahneman & Alan B. Krueger, 2006. "Developments in the Measurement of Subjective Well-Being," Journal of Economic Perspectives, American Economic Association, vol. 20(1), pages 3-24, Winter.
- Shorrocks, A F, 1978. "The Measurement of Mobility," Econometrica, Econometric Society, vol. 46(5), pages 1013-24, September.
- Shalev, Jonathan, 1997.
"Loss aversion in a multi-period model,"
Mathematical Social Sciences,
Elsevier, vol. 33(3), pages 203-226, June.
- Kakwani, Nanak, 1980. "On a Class of Poverty Measures," Econometrica, Econometric Society, vol. 48(2), pages 437-46, March.
- Jalan, Jyotsna & Ravallion, Martin, 1998. "Transient Poverty in Postreform Rural China," Journal of Comparative Economics, Elsevier, vol. 26(2), pages 338-357, June.
- Read, Daniel & Read, N. L., 2004. "Time discounting over the lifespan," Organizational Behavior and Human Decision Processes, Elsevier, vol. 94(1), pages 22-32, May.
- Sen, Amartya K, 1976. "Poverty: An Ordinal Approach to Measurement," Econometrica, Econometric Society, vol. 44(2), pages 219-31, March.
When requesting a correction, please mention this item's handle: RePEc:ecl:harjfk:rwp09-035. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.