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On the re-assessment of inequality in Indonesia: household survey or national account?

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  • Yusuf, Arief Anshory

Abstract

This paper is motivated by the inconsistency between food and non-food ex-penditure estimated from household survey data (SUSENAS) and from nationalaccount (I-O table) and its connection on the issue of inequality in Indonesia.Since non-food expenditure tend to be under-estimated when compared withnational account data, it imply the under-representation of the rich in the cal-culation of inequality in Indonesia. This paper, then applies an approach toreconciling household survey and national accounts data, by re-estimating thesampling weight through minimization of entropy distance of information takinghousehold survey weight as prior, while satisfying some aggregation constraints.The estimated weight then is used to calculate standard indicator of inequalityin Indonesia. The results suggests that while inequality in rural Indonesia doesnot change much, due to possible under-representation of the rich in the survey, inequality in urban Indonesia is highly under-estimated. The "Jakarta factor"seems to account mostly to this discrepancy.

Suggested Citation

  • Yusuf, Arief Anshory, 2006. "On the re-assessment of inequality in Indonesia: household survey or national account?," MPRA Paper 1728, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:1728
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    References listed on IDEAS

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    1. Takahiro AKITA & Rizal Affandi LUKMAN & Yukino YAMADA, 1999. "Inequality In The Distribution Of Household Expenditures In Indonesia: A Theil Decomposition Analysis," The Developing Economies, Institute of Developing Economies, vol. 37(2), pages 197-221, June.
    2. Anne‐Sophie Robilliard & Sherman Robinson, 2003. "Reconciling Household Surveys and National Accounts Data Using a Cross Entropy Estimation Method," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 49(3), pages 395-406, September.
    3. Löfgren, Hans & Harris, Rebecca Lee & Robinson, Sherman, 2001. "A standard computable general equilibrium (CGE) model in GAMS," TMD discussion papers 75, International Food Policy Research Institute (IFPRI).
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    Cited by:

    1. Arief Anshory Yusuf, 2014. "International Commodity Prices and Inequality in Indonesia," Working Papers in Economics and Development Studies (WoPEDS) 201409, Department of Economics, Padjadjaran University, revised Jun 2014.

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    More about this item

    Keywords

    inequality; Indonesia; entropy;
    All these keywords.

    JEL classification:

    • C80 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - General
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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