IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Estimation of Poverty Transition Matrices with Noisy Data

Listed author(s):
  • Nayoung Lee

    ()

    (Department of Economics, Chinese University of Hong Kong)

  • Geert Ridder

    ()

    (Department of Economics, USC)

  • John Strauss

    ()

    (Department of Economics, University of Southern California;)

This paper investigates potential measurement error biases in estimated poverty transition matrices. We compare transition matrices based on survey expenditure data to transition matrices based on measurement-error-free simulated expenditure. The simulation model uses estimates that correct for measurement error in expenditure. This dynamic model needs error-free initial conditions that can not be derived from these estimates. We provide bounds on the initial-conditions parameters, when these initial conditions are obtained by projection, and we also obtain initial conditions on the assumption that there is no time-constant measurement error. We ?nd that for both estimates of the initial conditions measurement error in expenditure data magni?es economic mobility in and out of poverty. Roughly 44% of households initially in poverty at time t??1 are found to be out of poverty at time t using expenditure data from the Korean Labor and Income Panel Study (KLIPS). However, when we remove measurement error through a model-based simulation, only between 32 and 40% of households initially in poverty are found to be out of poverty.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.econ.puc-rio.br/pdf/td576.pdf
Download Restriction: no

Paper provided by Department of Economics PUC-Rio (Brazil) in its series Textos para discussão with number 576.

as
in new window

Length: 60p
Date of creation: Sep 2010
Handle: RePEc:rio:texdis:576
Contact details of provider: Postal:
Rua Marquês de São Vicente, 225, 22453-900 Rio de Janeiro, RJ

Phone: 021 35271078
Fax: 021 35271084
Web page: http://www.econ.puc-rio.br

More information through EDIRC

References listed on IDEAS
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.:

as
in new window


  1. Jean-Yves Duclos & Abdelkrim Araaryand & John Giles, 2006. "Chronic and Transient Poverty: Measurement and Estimation, with Evidence from China," Working Papers 35, ECINEQ, Society for the Study of Economic Inequality.
  2. Antman, Francisca & McKenzie, David J., 2005. "Poverty traps and nonlinear income dynamics with measurement error and individual heterogeneity," Policy Research Working Paper Series 3764, The World Bank.
  3. Stefan Dercon, 1996. "Wealth, risk and activity choices: cattle in Western Tanzania," CSAE Working Paper Series 1996-08, Centre for the Study of African Economies, University of Oxford.
  4. Antman, Francisca & McKenzie, David J., 2005. "Earnings mobility and measurement error : a pseudo-panel approach," Policy Research Working Paper Series 3745, The World Bank.
  5. Stephen Bond & Frank Windmeijer, 2002. "Projection estimators for autoregressive panel data models," Econometrics Journal, Royal Economic Society, vol. 5(2), pages 457-479, 06.
  6. Bound, John & Krueger, Alan B, 1991. "The Extent of Measurement Error in Longitudinal Earnings Data: Do Two Wrongs Make a Right?," Journal of Labor Economics, University of Chicago Press, vol. 9(1), pages 1-24, January.
  7. Davidson, Russell & Duclos, Jean-Yves, 1998. "Statistical Inference for Stochastic Dominance and for the Measurement of Poverty and Inequality," Cahiers de recherche 9805, Université Laval - Département d'économique.
  8. Jalan, Jyotsna & Ravallion, Martin, 1998. "Transient Poverty in Postreform Rural China," Journal of Comparative Economics, Elsevier, vol. 26(2), pages 338-357, June.
  9. Ravallion, M. & Datt, G., 1991. "Growth and Redistribution Components of Changes in Poverty Measures," Papers 83, World Bank - Living Standards Measurement.
  10. Peter Gottschalk & Enrico Spolare, 2001. "On the Evaluation of Economic Mobility," Working Papers 2001-25, Brown University, Department of Economics.
  11. Stefan Dercon & Pramila Krishnan, 2000. "Vulnerability, seasonality and poverty in Ethiopia," Journal of Development Studies, Taylor & Francis Journals, vol. 36(6), pages 25-53.
  12. Lokshin Michael & Ravallion Martin, 2004. "Household Income Dynamics in Two Transition Economies," Studies in Nonlinear Dynamics & Econometrics, De Gruyter, vol. 8(3), pages 1-33, September.
  13. Zimmerman, Frederick J. & Carter, Michael R., 2003. "Asset smoothing, consumption smoothing and the reproduction of inequality under risk and subsistence constraints," Journal of Development Economics, Elsevier, vol. 71(2), pages 233-260, August.
  14. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Oxford University Press, vol. 58(2), pages 277-297.
  15. Kathleen McGarry, 1995. "Measurement Error and Poverty Rates of Widows," Journal of Human Resources, University of Wisconsin Press, vol. 30(1), pages 113-134.
  16. Bob Baulch & John Hoddinott, 2000. "Economic mobility and poverty dynamics in developing countries," Journal of Development Studies, Taylor & Francis Journals, vol. 36(6), pages 1-24.
  17. Martin Browning & Thomas F. Crossley & Guglielmo Weber, 2002. "Asking Consumption Questions in General Purpose Surveys," Social and Economic Dimensions of an Aging Population Research Papers 77, McMaster University.
  18. Datt, Gaurav & Ravallion, Martin, 1992. "Growth and redistribution components of changes in poverty measures : A decomposition with applications to Brazil and India in the 1980s," Journal of Development Economics, Elsevier, vol. 38(2), pages 275-295, April.
  19. Espen Villanger, 2003. "The effects of disasters on income mobility: Bootstrap inference and measurement error simulations," CMI Working Papers WP 2003:6, CMI (Chr. Michelsen Institute), Bergen, Norway.
  20. Lillard, Lee A & Willis, Robert J, 1978. "Dynamic Aspects of Earning Mobility," Econometrica, Econometric Society, vol. 46(5), pages 985-1012, September.
  21. Gary Fields & Paul Cichello & Samuel Freije & Marta Menendez & David Newhouse, 2003. "Household income dynamics: a four-country story," Journal of Development Studies, Taylor & Francis Journals, vol. 40(2), pages 30-54.
  22. Gaiha, Raghav & Deolalikar, Anil B, 1993. "Persistent, Expected and Innate Poverty: Estimates for Semi-arid Rural South India, 1975-1984," Cambridge Journal of Economics, Oxford University Press, vol. 17(4), pages 409-421, December.
  23. repec:dau:papers:123456789/1562 is not listed on IDEAS
  24. Bound, John & Brown, Charles & Mathiowetz, Nancy, 2001. "Measurement error in survey data," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 59, pages 3705-3843 Elsevier.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:rio:texdis:576. 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: ()

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.