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Poverty orderings and intra-household inequality: The lost axiom

Author

Listed:
  • Eugenio Peluso

    () (University of Verona)

  • Alain Trannoy

    () (EHESS, GREQAM-IDEP, Marseille)

Abstract

We investigate under which conditions it is possible to infer the evolution of poverty at the individual level from the knowledge of poverty among households. Poverty measurement is approached by the poverty orderings introduced by Foster and Shorrocks (1988). The analysis is based on a reduced form of household bargaining (Peluso and Trannoy 2007) and provides results in terms of preservation of poverty orderings. We point out the main analogies and differences between inequality and poverty assessment, expressing them in terms of empirically testable conditions. In particular, knowing the change in poverty at the household level is not sufficient to deduce a similar change in poverty at the individual level. We need to know the change in the household income distributions far beyond their poverty line. The focus axiom does not hold in this context.

Suggested Citation

  • Eugenio Peluso & Alain Trannoy, 2009. "Poverty orderings and intra-household inequality: The lost axiom," Working Papers 114, ECINEQ, Society for the Study of Economic Inequality.
  • Handle: RePEc:inq:inqwps:ecineq2009-114
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    File URL: http://www.ecineq.org/milano/WP/ECINEQ2009-114.pdf
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    Cited by:

    1. Couprie, Hélène & Peluso, Eugenio & Trannoy, Alain, 2010. "Is power more evenly balanced in poor households?," Journal of Public Economics, Elsevier, vol. 94(7-8), pages 493-507, August.

    More about this item

    Keywords

    Poverty orderings; intra-household allocation; concavity; focus axiom.;

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty

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