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An Asset-based Indicator of Wellbeing for a Unified Means Testing Tool: Money Metric or Counting Approach?

Author

Listed:
  • Martina Menon

    () (Department of Economics (University of Verona))

  • Federico Perali

    () (Department of Economics (University of Verona))

  • Eva Sierminska

    () (Liser)

Abstract

Abstract As part of the Europe 2020 strategy, European member states have committed to modernizing and harmonizing their welfare systems and to improving the quality of the means testing tools adopted to correctly identify the beneficiaries of welfare policies. This study contributes to the literature on means testing by implementing and then comparing two alternative multidimensional targeting approaches: an asset-based money metric and a counting measurement of poverty. The two approaches aggregate poverty dimensions and differently implement inter-household comparisons of wellbeing. The study shows that in terms of targeting efficiency the approach based on the money metric is superior. The comparison is important from both an empirical and a policy point of view because a unified means testing tool would pave the way to harmonized welfare policies across European countries.

Suggested Citation

  • Martina Menon & Federico Perali & Eva Sierminska, 2016. "An Asset-based Indicator of Wellbeing for a Unified Means Testing Tool: Money Metric or Counting Approach?," Working Papers 02/2016, University of Verona, Department of Economics.
  • Handle: RePEc:ver:wpaper:02/2016
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    References listed on IDEAS

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    Cited by:

    1. repec:spr:soinre:v:135:y:2018:i:1:d:10.1007_s11205-016-1484-1 is not listed on IDEAS
    2. Martina Menon & Federico Perali & Veronica Polin, 2015. "Il Nuovo Indicatore della Situazione Economica Equivalente: È Una Vera Riforma?," Working Papers 26/2015, University of Verona, Department of Economics.

    More about this item

    Keywords

    Means testing; multidimensional poverty; asset based poverty; wellbeing;

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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