IDEAS home Printed from https://ideas.repec.org/p/hdl/wpaper/1905.html
   My bibliography  Save this paper

Multidimensional poverty measurement with individual preferences

Author

Listed:
  • Koen Decancq
  • Marc Fleurbaey
  • François Maniquet

Abstract

We propose a new approach to multidimensional poverty measurement. To aggregate and weight the different dimensions of poverty, we rely on the preferences of the concerned individuals rather than on an arbitrary weighting scheme selected by the analyst. We provide an axiomatic characterization of an approach in which multidimensional poverty measures add up individual indices of poverty based on their multidimensional outcomes and their preferences. We discuss two families of these individual indices of poverty: quantity metrics and money metrics. Members of the first family evaluate individual poverty by the fraction of the poverty line vector to which the individual is indifferent. The second family considers the ratio between the income to which the individual is indifferent, for some fixed price vector, and the money value of the poverty line vector. We illustrate our approach with Russian survey data between 1995 and 2005. We find that, compared to standard poverty indices, our preference-sensitive indices lead to considerable differences in the identification of the poor

Suggested Citation

  • Koen Decancq & Marc Fleurbaey & François Maniquet, 2019. "Multidimensional poverty measurement with individual preferences," Working Papers 1905, Herman Deleeck Centre for Social Policy, University of Antwerp.
  • Handle: RePEc:hdl:wpaper:1905
    as

    Download full text from publisher

    File URL: https://medialibrary.uantwerpen.be/oldcontent/container2453/files/CSB%20WP%202019/CSBWorkingPaper1905.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Fleurbaey,Marc & Maniquet,François, 2011. "A Theory of Fairness and Social Welfare," Cambridge Books, Cambridge University Press, number 9780521715348, November.
    2. Koen Decancq & Marc Fleurbaey & Erik Schokkaert, 2017. "Wellbeing Inequality and Preference Heterogeneity," Economica, London School of Economics and Political Science, vol. 84(334), pages 210-238, April.
    3. Alpaslan Akay & Olivier Bargain & H. Xavier Jara, 2020. "‘Fair’ welfare comparisons with heterogeneous tastes: subjective versus revealed preferences," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 55(1), pages 51-84, June.
    4. Esfandiar Maasoumi & Maria Ana Lugo, 2008. "The Information Basis of Multivariate Poverty Assessments," Palgrave Macmillan Books, in: Nanak Kakwani & Jacques Silber (ed.), Quantitative Approaches to Multidimensional Poverty Measurement, chapter 1, pages 1-29, Palgrave Macmillan.
    5. Adler, Matthew D. & Dolan, Paul & Kavetsos, Georgios, 2017. "Would you choose to be happy? Tradeoffs between happiness and the other dimensions of life in a large population survey," Journal of Economic Behavior & Organization, Elsevier, vol. 139(C), pages 60-73.
    6. Jean-Yves Duclos & David E. Sahn & Stephen D. Younger, 2006. "Robust Multidimensional Poverty Comparisons," Economic Journal, Royal Economic Society, vol. 116(514), pages 943-968, October.
    7. Andrew M. Jones & Stefanie Schurer, 2011. "How does heterogeneity shape the socioeconomic gradient in health satisfaction?," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 26(4), pages 549-579, June.
    8. Fleurbaey, Marc & Maniquet, François, 2017. "Fairness and well-being measurement," Mathematical Social Sciences, Elsevier, vol. 90(C), pages 119-126.
    9. Walter Bossert & Satya R. Chakravarty & Conchita D’Ambrosio, 2019. "Multidimensional Poverty and Material Deprivation with Discrete Data," Themes in Economics, in: Satya R. Chakravarty (ed.), Poverty, Social Exclusion and Stochastic Dominance, pages 191-209, Springer.
    10. Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, vol. 52(3), pages 761-766, May.
    11. Alkire, Sabina & Foster, James, 2011. "Counting and multidimensional poverty measurement," Journal of Public Economics, Elsevier, vol. 95(7-8), pages 476-487, August.
    12. Sprumont, Yves & Zhou, Lin, 1999. "Pazner-Schmeidler rules in large societies," Journal of Mathematical Economics, Elsevier, vol. 31(3), pages 321-339, April.
    13. Martin Ravallion, 2011. "On multidimensional indices of poverty," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 9(2), pages 235-248, June.
    14. Ravallion, Martin, 1996. "Issues in Measuring and Modelling Poverty," Economic Journal, Royal Economic Society, vol. 106(438), pages 1328-1343, September.
    15. Francisco H. G. Ferreira & Maria Ana Lugo, 2013. "Multidimensional Poverty Analysis: Looking for a Middle Ground," The World Bank Research Observer, World Bank, vol. 28(2), pages 220-235, August.
    16. Layard, R. & Mayraz, G. & Nickell, S., 2008. "The marginal utility of income," Journal of Public Economics, Elsevier, vol. 92(8-9), pages 1846-1857, August.
    17. François Bourguignon & Satya R. Chakravarty, 2019. "The Measurement of Multidimensional Poverty," Themes in Economics, in: Satya R. Chakravarty (ed.), Poverty, Social Exclusion and Stochastic Dominance, pages 83-107, Springer.
    18. Zheng, Buhong, 1997. "Aggregate Poverty Measures," Journal of Economic Surveys, Wiley Blackwell, vol. 11(2), pages 123-162, June.
    19. Jean-Yves Duclos & David Sahn & Stephen D. Younger, 2006. "Robust Multidimensional Poverty Comparisons with Discrete Indicators of Well-being," Cahiers de recherche 0628, CIRPEE.
    20. Paul Frijters & Ingo Geishecker & John P. Haisken‐DeNew & Michael A. Shields, 2006. "Can the Large Swings in Russian Life Satisfaction be Explained by Ups and Downs in Real Incomes?," Scandinavian Journal of Economics, Wiley Blackwell, vol. 108(3), pages 433-458, October.
    21. Zheng, Buhong, 2000. "Poverty Orderings," Journal of Economic Surveys, Wiley Blackwell, vol. 14(4), pages 427-466, September.
    22. Kristof Bosmans & Luc Lauwers & Erwin Ooghe, 2018. "Prioritarian Poverty Comparisons with Cardinal and Ordinal Attributes," Scandinavian Journal of Economics, Wiley Blackwell, vol. 120(3), pages 925-942, July.
    23. Samuelson, Paul A, 1977. "Reaffirming the Existence of "Reasonable" Bergson-Samuelson Social Welfare Functions," Economica, London School of Economics and Political Science, vol. 44(173), pages 81-88, February.
    24. Fleurbaey, Marc, 2007. "Two criteria for social decisions," Journal of Economic Theory, Elsevier, vol. 134(1), pages 421-447, May.
    25. Marc Fleurbaey & Stéphane Luchini & Christophe Muller & Erik Schokkaert, 2013. "Equivalent Income And Fair Evaluation Of Health Care," Health Economics, John Wiley & Sons, Ltd., vol. 22(6), pages 711-729, June.
    26. Graham, Carol & Eggers, Andrew & Sukhtankar, Sandip, 2004. "Does happiness pay?: An exploration based on panel data from Russia," Journal of Economic Behavior & Organization, Elsevier, vol. 55(3), pages 319-342, November.
    27. Koen Decancq & Erik Schokkaert, 2016. "Beyond GDP: Using Equivalent Incomes to Measure Well-Being in Europe," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 126(1), pages 21-55, March.
    28. Fleurbaey, Marc, 2007. "Two criteria for social decisions," Journal of Economic Theory, Elsevier, vol. 134(1), pages 421-447, May.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Burhan Can Karahasan & Fırat Bilgel, 2021. "The Topography and Sources of Multidimensional Poverty in Turkey," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 154(2), pages 413-445, April.
    2. LABAR, Kelly & BRESSON, Florent, 2011. "A multidimensional analysis of poverty in China from 1991 to 2006," China Economic Review, Elsevier, vol. 22(4), pages 646-668.
    3. World Bank, 2022. "A Welfarist Theory Unifying Monetary and Non-Monetary Poverty Measurement," Policy Research Working Paper Series 10076, The World Bank.
    4. James Foster & Joel Greer & Erik Thorbecke, 2010. "The Foster–Greer–Thorbecke (FGT) poverty measures: 25 years later," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 8(4), pages 491-524, December.
    5. James E. Foster & Joel Greer & Erik Thorbecke, 2010. "The Foster-Greer-Thorbecke (FGT) Poverty Measures: Twenty-Five Years Later," Working Papers 2010-14, The George Washington University, Institute for International Economic Policy.
    6. Maria Emma Santos, 2014. "Measuring Multidimensional Poverty in Latin America: Previous Experience and the Way Forward," OPHI Working Papers 66, Queen Elizabeth House, University of Oxford.
    7. Sung-Geun Kim, 2015. "Fuzzy Multidimensional Poverty Measurement: An Analysis of Statistical Behaviors," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 120(3), pages 635-667, February.
    8. Sabina Alkire, 2011. "Multidimensional Poverty and its Discontents," OPHI Working Papers 46, Queen Elizabeth House, University of Oxford.
    9. Mekonnen Bersisa & Almas Heshmati, 2021. "A Distributional Analysis of Uni-and Multidimensional Poverty and Inequalities in Ethiopia," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 155(3), pages 805-835, June.
    10. Espinoza-Delgado, José & Silber, Jacques, 2018. "Multi-dimensional poverty among adults in Central America and gender differences in the three I’s of poverty: Applying inequality sensitive poverty measures with ordinal variables," MPRA Paper 88750, University Library of Munich, Germany.
    11. Alkire, Sabina & Santos, Maria Emma, 2014. "Measuring Acute Poverty in the Developing World: Robustness and Scope of the Multidimensional Poverty Index," World Development, Elsevier, vol. 59(C), pages 251-274.
    12. Marko Ledić & Ivica Rubil, 2021. "Beyond Wage Gap, Towards Job Quality Gap: The Role of Inter-Group Differences in Wages, Non-Wage Job Dimensions, and Preferences," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 155(2), pages 523-561, June.
    13. Espinoza-Delgado, José & Klasen, Stephan, 2018. "Gender and multidimensional poverty in Nicaragua: An individual based approach," World Development, Elsevier, vol. 110(C), pages 466-491.
    14. Koen Decancq & Marc Fleurbaey & Erik Schokkaert, 2017. "Wellbeing Inequality and Preference Heterogeneity," Economica, London School of Economics and Political Science, vol. 84(334), pages 210-238, April.
    15. DECANCQ, Koen & NEUMANN, Dirk, 2014. "Does the choice of well-being measure matter empirically? An illustration with German data," LIDAM Discussion Papers CORE 2014050, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    16. Joachim Merz & Tim Rathjen, 2014. "Multidimensional time and income poverty: well-being gap and minimum 2DGAP poverty intensity – German evidence," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 12(4), pages 555-580, December.
    17. Malokele Nanivazo, 2015. "First Order Dominance Analysis: Child Wellbeing in the Democratic Republic of Congo," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 122(1), pages 235-255, May.
    18. Dipesh Gangopadhyay & Robert B. Nielsen & Velma Zahirovic-Herbert, 2021. "Methodology and Axiomatic Characterization of a Multidimensional and Fuzzy Measure of Deprivation," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 153(1), pages 1-37, January.
    19. José Roche, 2013. "Monitoring Progress in Child Poverty Reduction: Methodological Insights and Illustration to the Case Study of Bangladesh," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 112(2), pages 363-390, June.
    20. Buhong Zheng, 2015. "Poverty: fuzzy measurement and crisp ordering," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 45(1), pages 203-229, June.

    More about this item

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hdl:wpaper:1905. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Santiago Burone (email available below). General contact details of provider: https://edirc.repec.org/data/csbuabe.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.