Two Scales, One Methodology - Expenditure Based Equivalence Scales for the United States and Germany
Choosing an appropriate equivalence scale is a prerequisite for comparisons of economic wellbeing income distribution, inequality or poverty. This is true for country specific work or for cross-national comparisons. Researchers generally either use a country specific equivalence scale (social assistance, expert based, or poverty scales), or adopt a single scale for all comparison across countries. Here we follow a different approach. We use microdata to estimate equivalence scales based on a revealed preference consumption approach for West Germany and the United States. We review several approaches and rely on a complete demand system approach, which provides constant utility based equivalence scales using an extended linear expenditure system (ELES). The multiple equation expenditure system takes into account a full market basket with all its interdependencies and relative prices. Our consumption-based equivalence results are compared to alternative consumption based measures, expert based measures, and subjective based measures in use in both countries and to other scales used for cross-national comparisons.
|Date of creation:||Apr 1994|
|Date of revision:|
|Contact details of provider:|| Web page: http://ffb.uni-lueneburg.de/repec/leu/|
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Blackorby, Charles & Bossert, Walter, 2004.
"Interpersonal Comparisons Of Well-Being,"
The Warwick Economics Research Paper Series (TWERPS)
711, University of Warwick, Department of Economics.
- BLACKORBY, Charles & BOSSERT, Walter, 2004. "Interpersonal Comparisons of Well-Being," Cahiers de recherche 2004-06, Universite de Montreal, Departement de sciences economiques.
- BLACKORBY, Charles & BOSSERT, Walter, 2004. "Interpersonal Comparisons of Well-Being," Cahiers de recherche 06-2004, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
- Arie Kapteyn & Peter Kooreman & Rob Willemse, 1988.
"Some Methodological Issues in the Implementation of Subjective Poverty Definitions,"
Journal of Human Resources,
University of Wisconsin Press, vol. 23(2), pages 222-242.
- Kapteyn, A.J. & Kooreman, P. & Willemse, R., 1987. "Some methodological issues in the implementation of subjective poverty definitions," Research Memorandum FEW 245, Tilburg University, School of Economics and Management.
- Bojer, Hilde, 1977. "The effect on consumption of household size and composition," European Economic Review, Elsevier, vol. 9(2), pages 169-193.
- Bruce Bradbury, 1992.
"Measuring the Cost of Children,"
0032, University of New South Wales, Social Policy Research Centre.
- van Praag, Bernard M S & Hagenaars, Aldi J M & van Weeren, Hans, 1982. "Poverty in Europe," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 28(3), pages 345-59, September.
- Tsakloglou, Panos, 1991. "Estimation and Comparison of Two Simple Models of Equivalence Scales for the Cost of Children," Economic Journal, Royal Economic Society, vol. 101(405), pages 343-57, March.
- Coulter, Fiona A E & Cowell, Frank A & Jenkins, Stephen P, 1992. "Differences in Needs and Assessment of Income Distributions," Bulletin of Economic Research, Wiley Blackwell, vol. 44(2), pages 77-124, April.
- Lluch, Constantino, 1973. "The extended linear expenditure system," European Economic Review, Elsevier, vol. 4(1), pages 21-32, April.
- Muellbauer, John, 1977. "Testing the Barten Model of Household Composition Effects and the Cost of Children," Economic Journal, Royal Economic Society, vol. 87(347), pages 460-87, September.
- Gronau, Reuben, 1988. "Consumption Technology and the Intrafamily Distribution of Resources:," Journal of Political Economy, University of Chicago Press, vol. 96(6), pages 1183-1205, December.
- McClements, L. D., 1977. "Equivalence scales for children," Journal of Public Economics, Elsevier, vol. 8(2), pages 191-210, October.
- de Vos, Klaas & Garner, Thesia I, 1991. "An Evaluation of Subjective Poverty Definitions: Comparing Results from the U.S. and the Netherlands," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 37(3), pages 267-85, September.
- Singh, Balvir & Nagar, A L, 1973. "Determination of Consumer Unit Scales," Econometrica, Econometric Society, vol. 41(2), pages 347-55, March.
When requesting a correction, please mention this item's handle: RePEc:leu:wpaper:08. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Joachim Merz)
If references are entirely missing, you can add them using this form.