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Conversion Efficiency as a Complementing Measure of Welfare in Capability Space

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  • Binder, Martin
  • Broekel, Tom

Abstract

In the capability literature, studies on the empirical measurement in the functionings space are abundant and a few studies even measure capability to function. We suggest adopting a third measure of welfare relevant to economists, namely the "conversion efficiency" measuring the efficiency with which individuals convert their resources into achieved functioning. We use a nonparametric efficiency procedure and construct such a measure for a basket of basic functioning achievement, using data from the British Household Panel Survey (BHPS).

Suggested Citation

  • Binder, Martin & Broekel, Tom, 2008. "Conversion Efficiency as a Complementing Measure of Welfare in Capability Space," MPRA Paper 7583, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:7583
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    References listed on IDEAS

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    5. Francesco Farina & Eugenio Peluso & Ernesto Savaglio, 2005. "Ranking opportunity sets in the space of functionings," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 2(2), pages 105-116, January.
    6. Wilson, Paul W, 1993. "Detecting Outliers in Deterministic Nonparametric Frontier Models with Multiple Outputs," Journal of Business & Economic Statistics, American Statistical Association, vol. 11(3), pages 319-323, July.
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    8. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74, pages 132-132.
    9. David C. Wheelock & Paul W. Wilson, 2003. "Robust nonparametric estimation of efficiency and technical change in U.S. commercial banking," Working Papers 2003-037, Federal Reserve Bank of St. Louis.
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    Cited by:

    1. Jürgen Volkert & Friedrich Schneider, 2011. "The Application of the Capability Approach to High-Income OECD Countries: A Preliminary Survey," CESifo Working Paper Series 3364, CESifo Group Munich.
    2. Leßmann, Ortrud, 2011. "Empirische Studien zum Capability Ansatz auf der Grundlage von Befragungen: Ein Überblick," UFZ Discussion Papers 4/2011, Helmholtz Centre for Environmental Research (UFZ), Division of Social Sciences (ÖKUS).
    3. Hasan, Hamid, 2009. "Capabilities measurement: an empirical investigation," MPRA Paper 16742, University Library of Munich, Germany, revised 12 Aug 2009.
    4. Stefan Felder & Harald Tauchmann, 2013. "Federal state differentials in the efficiency of health production in Germany: an artifact of spatial dependence?," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 14(1), pages 21-39, February.

    More about this item

    Keywords

    conversion efficiency; welfare measurement; robust nonparametric efficiency analysis; functioning production;

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty

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