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Empirical Issues in Lifetime Poverty Measurement

  • Hoy, Michael
  • Scott B., Thompson
  • Zheng, Buhong

This paper demonstrates the implications of adopting an approach to measuring poverty that takes into account the lifetime experience of individuals rather than simply taking a static or cross-sectional perspective. Our approach follows the theoretical innovations in Hoy and Zheng (2008) which address various aspects of the specific pattern of any poverty spells experienced by an individual as well as a possible retrospective consideration that an individual might have concerning his life experience as a whole. For an individual, our perspective of lifetime poverty is influenced by both the snapshot poverty of each period and the poverty level of the permanent lifetime consumption; it is also influenced by how poverty spells are distributed over the lifetime. Using PSID data for the US, we demonstrate empirically the power of alternative axioms concerning how lifetime poverty should be measured when making pairwise comparisons of individual lifetime profiles of consumption (income) experiences. We also demonstrate the importance of taking a lifetime view of poverty in comparing poverty between groups by use of the classic FGT ‘snapshot’ poverty index in conjunction with period weighting functions that explicitly reflect concerns about the pattern of poverty spells over individuals’ lifetimes.

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File URL: http://www.wider.unu.edu/stc/repec/pdfs/wp2010/wp2010-73.pdf
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Paper provided by World Institute for Development Economic Research (UNU-WIDER) in its series Working Paper Series with number wp2010-73.

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Length: 45 pages
Date of creation: 2010
Date of revision:
Handle: RePEc:unu:wpaper:wp2010-73
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  1. Johannes Gräb & Michael Grimm, 2007. "Robust Multiperiod Poverty Comparisons," Ibero America Institute for Econ. Research (IAI) Discussion Papers 160, Ibero-America Institute for Economic Research.
  2. David Clark & David Hulme, 2010. "Poverty, time and vagueness: integrating the core poverty and chronic poverty frameworks," Cambridge Journal of Economics, Oxford University Press, vol. 34(2), pages 347-366, March.
  3. James E. Foster, 2007. "A Class of Chronic Poverty Measures," Vanderbilt University Department of Economics Working Papers 0701, .
  4. Cesar Calvo & Stefan Dercon, 2007. "Chronic Poverty and All That: The Measurement of Poverty over Time," CSAE Working Paper Series 2007-04, Centre for the Study of African Economies, University of Oxford.
  5. Zheng, Buhong, 1997. " Aggregate Poverty Measures," Journal of Economic Surveys, Wiley Blackwell, vol. 11(2), pages 123-62, June.
  6. Joan R. Rodgers & John L. Rodgers, 1993. "Chronic Poverty in the United States," Journal of Human Resources, University of Wisconsin Press, vol. 28(1), pages 25-54.
  7. Zheng, Buhong, 2000. " Poverty Orderings," Journal of Economic Surveys, Wiley Blackwell, vol. 14(4), pages 427-66, September.
  8. Atkinson, Anthony B., 1970. "On the measurement of inequality," Journal of Economic Theory, Elsevier, vol. 2(3), pages 244-263, September.
  9. Michael Hoy & Buhong Zheng, 2008. "Measuring Lifetime Poverty," Working Papers 0814, University of Guelph, Department of Economics and Finance.
  10. Arranz, José Maria & Cantó, Olga, 2010. "Measuring the Effect of Spell Recurrence on Poverty Dynamics," Working Paper Series wp2010-72, World Institute for Development Economic Research (UNU-WIDER).
  11. Jyotsna Jalan & Martin Ravallion, 2000. "Is transient poverty different? Evidence for rural China," Journal of Development Studies, Taylor & Francis Journals, vol. 36(6), pages 82-99.
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