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Measuring Economic Insecurity

Author

Listed:
  • Walter Bossert

    (Department of Economics and CIREQ, University of Montreal)

  • Conchita D'Ambrosio

    (Università di Milano-Bicocca, DIW Berlin and Econpubblica, Università Bocconi)

Abstract

We provide a systematic treatment of the notion of economic insecurity, assuming that an individual’s sentiment of insecurity depends on the current wealth level and its variations experienced in the past. We think of wealth as a comprehensive variable encompassing anything that may help in coping with adverse occurrences. The current wealth level could also be interpreted as incorporating the individual’s evaluation of future prospects. Variations in wealth experienced in the recent past are given higher weight than experiences that occurred in the more distant past. Two classes of measures are characterized with sets of plausible and intuitive axioms.

Suggested Citation

  • Walter Bossert & Conchita D'Ambrosio, 2009. "Measuring Economic Insecurity," Working Papers 111, ECINEQ, Society for the Study of Economic Inequality.
    • Handle: RePEc:inq:inqwps:ecineq2009-111
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    File URL: http://www.ecineq.org/milano/WP/ECINEQ2009-111.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Insecurity; Wealth Distribution; Social Index Numbers;
    All these keywords.

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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