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Chronic and Transient Poverty: Measurement and Estimation, with Evidence from China

Author

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  • Duclos, Jean-Yves

    (Université Laval)

  • Araar, Abdelkrim

    (Université Laval)

  • Giles, John T.

    (World Bank)

Abstract

The paper contributes to the measurement of poverty and vulnerability in three ways. First, we propose a new approach to separating poverty into chronic and transient components. Second, we provide corrections for the statistical biases introduced when using a small number of periods to estimate the importance of vulnerability and transient poverty. Third, we apply these tools to the measurement of chronic and transient poverty in China using a rich panel data set that extends over approximately 17 years. We find that alternative measurement techniques yield significantly different estimates of the relative importance of chronic and transient poverty, and that precision of estimates is enhanced with simple statistical corrections.

Suggested Citation

  • Duclos, Jean-Yves & Araar, Abdelkrim & Giles, John T., 2006. "Chronic and Transient Poverty: Measurement and Estimation, with Evidence from China," IZA Discussion Papers 2078, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp2078
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    References listed on IDEAS

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    More about this item

    Keywords

    permanent poverty; chronic poverty; transient poverty; poverty dynamics; China;
    All these keywords.

    JEL classification:

    • C15 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Statistical Simulation Methods: General
    • 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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