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How Valid are Synthetic Panel Estimates of Poverty Dynamics?

Author

Listed:
  • Nicolas Herault

    (Melbourne Institute: Applied Economic & Social Research, The University of Melbourne)

  • Stephen P. Jenkins

    (London School of Economics, Institute for Social and Economic Research, University of Essex, Institute for the Study of Labor (IZA))

Abstract

A growing literature uses repeated cross-section surveys to derive ‘synthetic panel’ data estimates of poverty dynamics statistics. It builds on the pioneering study by Dang, Lanjouw, Luoto, and McKenzie (Journal of Development Economics, 2014) providing bounds estimates and the innovative refinement proposed by Dang and Lanjouw (World Bank Policy Research Working Paper 6504, 2013) providing point estimates of the statistics of interest. We provide new evidence about the accuracy of synthetic panel estimates relative to benchmarks based on estimates derived from genuine household panel data, employing high quality data from Australia and Britain, while also examining the sensitivity of results to a number of analytical choices. Overall, we are more agnostic about the validity of the synthetic panel approach applied to these two rich countries than are earlier validity studies in their applications focusing on middle- and low- income countries.

Suggested Citation

  • Nicolas Herault & Stephen P. Jenkins, 2018. "How Valid are Synthetic Panel Estimates of Poverty Dynamics?," Melbourne Institute Working Paper Series wp2018n05, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    • Handle: RePEc:iae:iaewps:wp2018n05
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. How Valid are Synthetic Panel Estimates of Poverty Dynamics?
      by maximorossi in NEP-LTV blog on 2019-04-29 14:02:10

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    Cited by:

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    2. Lanjouw Peter, 2020. "Income mobility in the developing world: Recent approaches and evidence," WIDER Working Paper Series wp2020-7, World Institute for Development Economic Research (UNU-WIDER).
    3. Leonardo Gasparini & Pablo Gluzmann & Leopoldo Tornarolli, 2022. "Caracterización de la población vulnerable: una propuesta con estimaciones para Argentina," Económica, Departamento de Economía, Facultad de Ciencias Económicas, Universidad Nacional de La Plata, vol. 68, pages 135-157, January-D.
    4. Brian Colgan, 2023. "EU-SILC and the potential for synthetic panel estimates," Empirical Economics, Springer, vol. 64(3), pages 1247-1280, March.
    5. Dang, Hai-Anh H & Lanjouw, Peter F., 2021. "Data Scarcity and Poverty Measurement," IZA Discussion Papers 14631, Institute of Labor Economics (IZA).
    6. Federica Alfani & Fabio Clementi & Michele Fabiani & Vasco Molini & Enzo Valentini, 2023. "Once NEET, always NEET? A synthetic panel approach to analyze the Moroccan labor market," Review of Development Economics, Wiley Blackwell, vol. 27(4), pages 2401-2437, November.
    7. Jehovaness Aikaeli & David Garcés‐Urzainqui & Kenneth Mdadila, 2021. "Understanding poverty dynamics and vulnerability in Tanzania: 2012–2018," Review of Development Economics, Wiley Blackwell, vol. 25(4), pages 1869-1894, November.
    8. Gerton Rongen & Zainab Ali Ahmad & Peter Lanjouw & Kenneth Simler, 2024. "Regional and ethnic inequalities in Malaysian poverty dynamics," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 22(1), pages 101-130, March.
    9. Vincenzo Salvucci & Finn Tarp, 2021. "Poverty and vulnerability in Mozambique: An analysis of dynamics and correlates in light of the Covid‐19 crisis using synthetic panels," Review of Development Economics, Wiley Blackwell, vol. 25(4), pages 1895-1918, November.
    10. Roger Wilkins, 2021. "Economic Wellbeing," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 54(4), pages 469-481, December.
    11. Hai‐Anh Dang & Peter Lanjouw & Elise Vrijburg, 2021. "Poverty in India in the face of Covid‐19: Diagnosis and prospects," Review of Development Economics, Wiley Blackwell, vol. 25(4), pages 1816-1837, November.
    12. Kimberly Bolch & Luis F. Lopez‐Calva & Eduardo Ortiz‐Juarez, 2023. "“When Life Gives You Lemons”: Using Cross‐Sectional Surveys to Identify Chronic Poverty in the Absence of Panel Data," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 69(2), pages 474-503, June.
    13. Hai-Anh H. Dang & Peter F. Lanjouw, 2023. "Regression-based imputation for poverty measurement in data-scarce settings," Chapters, in: Jacques Silber (ed.), Research Handbook on Measuring Poverty and Deprivation, chapter 13, pages 141-150, Edward Elgar Publishing.
    14. Himanshu & Peter Lanjouw, 2020. "Income mobility in the developing world: Recent approaches and evidence," WIDER Working Paper Series wp-2020-7, World Institute for Development Economic Research (UNU-WIDER).
    15. Amendola,Nicola & Belotti,Federico & Alvin Etang Ndip & Mancini,Giulia & Vecchi,Giovanni, 2025. "Poverty Dynamics in Bhutan, 2017–2022 : Evidence from Synthetic Panels," Policy Research Working Paper Series 11031, The World Bank.
    16. Dede Woade Gafa & Louis Sitsofe Hodey & Bernardin Senadza, 2024. "Examining Poverty Dynamics in Ghana: Evidence from Longitudinal and Repeated Cross-Sectional Data," Journal of African Economies, Centre for the Study of African Economies, vol. 33(Supplemen), pages 136-157.
    17. Hai‐Anh H. Dang & Peter F. Lanjouw, 2023. "Measuring Poverty Dynamics with Synthetic Panels Based on Repeated Cross Sections," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 85(3), pages 599-622, June.
    18. Rongen,Gerton & Binti Ali Ahmad,Zainab & Lanjouw,Peter F. & Simler,Kenneth, 2022. "The Interplay of Regional and Ethnic Inequalities in Malaysian Poverty Dynamics," Policy Research Working Paper Series 9898, The World Bank.
    19. Ayesha Tantriana, 2024. "Poverty and vulnerability transitions in Indonesia before and during the COVID-19: insights from synthetic panels," Quality & Quantity: International Journal of Methodology, Springer, vol. 58(4), pages 3215-3249, August.
    20. Alessio Fusco & Philippe Van Kerm, 2023. "Measuring poverty persistence," Chapters, in: Jacques Silber (ed.), Research Handbook on Measuring Poverty and Deprivation, chapter 18, pages 192-200, Edward Elgar Publishing.
    21. David Garcés‐Urzainqui & Peter Lanjouw & Gerton Rongen, 2021. "Constructing synthetic panels for the purpose of studying poverty dynamics: A primer," Review of Development Economics, Wiley Blackwell, vol. 25(4), pages 1803-1815, November.

    More about this item

    Keywords

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    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation, Validation, and Selection

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