IDEAS home Printed from https://ideas.repec.org/p/wbk/wbrwps/5683.html
   My bibliography  Save this paper

Small area estimation-based prediction methods to track poverty : validation and applications

Author

Listed:
  • Christiaensen, Luc
  • Lanjouw, Peter
  • Luoto, Jill
  • Stifel, David

Abstract

Tracking poverty is predicated on the availability of comparable consumption data and reliable price deflators. However, regular series of strictly comparable data are only rarely available. Price deflators are also often missing or disputed. In response, poverty prediction methods that track consumption correlates as opposed to consumption itself have been developed. These methods typically assume that the estimated relation between consumption and its predictors is stable over time -- an assumption that cannot usually be tested directly. This study analyzes the performance of poverty prediction models based on small area estimation techniques. Predicted poverty estimates are compared with directly observed levels in two country settings where data comparability over time is not a problem. Prediction models that employ either non-staple food or non-food expenditures or a full set of assets as predictors are found to yield poverty estimates that match observed poverty well. This offers some support to the use of such methods to approximate the evolution of poverty. Two further country examples illustrate how an application of the method employing models based on household assets can help to adjudicate between alternative price deflators.

Suggested Citation

  • Christiaensen, Luc & Lanjouw, Peter & Luoto, Jill & Stifel, David, 2011. "Small area estimation-based prediction methods to track poverty : validation and applications," Policy Research Working Paper Series 5683, The World Bank.
  • Handle: RePEc:wbk:wbrwps:5683
    as

    Download full text from publisher

    File URL: http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2011/06/15/000158349_20110615112641/Rendered/PDF/WPS5683.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Carlo Azzarri & Gero Carletto & Benjamin Davis & Alberto Zezza, 2006. "Monitoring Poverty Without Consumption Data : An Application Using the Albania Panel Survey," Eastern European Economics, Taylor & Francis Journals, vol. 44(1), pages 59-82, February.
    2. Michael Grimm & Isabel Günther, 2007. "Growth and Poverty in Burkina Faso: A Reassessment of the Paradox," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 16(1), pages 70-101, January.
    3. Beegle, Kathleen & De Weerdt, Joachim & Friedman, Jed & Gibson, John, 2012. "Methods of household consumption measurement through surveys: Experimental results from Tanzania," Journal of Development Economics, Elsevier, vol. 98(1), pages 3-18.
    4. Chris Elbers & Jean O. Lanjouw & Peter Lanjouw, 2003. "Micro--Level Estimation of Poverty and Inequality," Econometrica, Econometric Society, vol. 71(1), pages 355-364, January.
    5. Tarozzi, Alessandro, 2007. "Calculating Comparable Statistics From Incomparable Surveys, With an Application to Poverty in India," Journal of Business & Economic Statistics, American Statistical Association, vol. 25, pages 314-336, July.
    6. Sarah Harrower & John Hoddinott, 2005. "Consumption Smoothing in the Zone Lacustre, Mali," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 14(4), pages 489-519, December.
    7. John Gibson & Jikun Huang & Scott Rozelle, 2003. "Improving Estimates of Inequality and Poverty from Urban China's Household Income and Expenditure Survey," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 49(1), pages 53-68, March.
    8. (No last name available), Himanshu, 2013. "Poverty and Food Security in India," ADB Economics Working Paper Series 369, Asian Development Bank.
    9. repec:pri:rpdevs:deaton_price_trends_in_india_version_3_jan_08_all is not listed on IDEAS
    10. Jean Olson Lanjouw & Peter Lanjouw, 2001. "How to Compare Apples And Oranges: Poverty Measurement Based on Different Definitions of Consumption," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 47(1), pages 25-42, March.
    11. Gabriel DEMOMBYNES & Chris ELBERS & Jean O. LANJOUW & Peter LANJOUW, 2008. "How Good is a Map? Putting Small Area Estimation to the Test," Rivista Internazionale di Scienze Sociali, Vita e Pensiero, Pubblicazioni dell'Universita' Cattolica del Sacro Cuore, vol. 116(4), pages 465-493.
    12. Gibson, John & Stillman, Steven & Le, Trinh, 2008. "CPI bias and real living standards in Russia during the transition," Journal of Development Economics, Elsevier, vol. 87(1), pages 140-160, August.
    13. Astrid Mathiassen, 2009. "A model based approach for predicting annual poverty rates without expenditure data," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 7(2), pages 117-135, June.
    14. Alessandro Tarozzi & Angus Deaton, 2009. "Using Census and Survey Data to Estimate Poverty and Inequality for Small Areas," The Review of Economics and Statistics, MIT Press, vol. 91(4), pages 773-792, November.
    15. repec:pri:rpdevs:deaton_adjusted_poverty_india is not listed on IDEAS
    16. Steven Stillman & Duncan Thomas, 2008. "Nutritional Status During an Economic Crisis: Evidence from Russia," Economic Journal, Royal Economic Society, vol. 118(531), pages 1385-1417, August.
    17. Yoko Kijima & Lanjouw, Peter, 2003. "Poverty in India during the1990s - a regional perspective," Policy Research Working Paper Series 3141, The World Bank.
    18. Tarozzi, Alessandro, 2011. "Can census data alone signal heterogeneity in the estimation of poverty maps?," Journal of Development Economics, Elsevier, vol. 95(2), pages 170-185, July.
    19. Martin Wall & Deborah Johnston, 2008. "Counting Heads or Counting Televisions: Can Asset-based Measures of Welfare Assist Policy-makers in Russia?," Journal of Human Development and Capabilities, Taylor & Francis Journals, vol. 9(1), pages 131-147.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Talip Kilic & Thomas Pave Sohnesen, 2019. "Same Question But Different Answer: Experimental Evidence on Questionnaire Design's Impact on Poverty Measured by Proxies," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 65(1), pages 144-165, March.
    2. Alfani, Federica & Dabalen, Andrew & Fisker, Peter & Molini, Vasco, 2015. "Can we measure resilience ? a proposed method and evidence from countries in the Sahel," Policy Research Working Paper Series 7170, The World Bank.
    3. World Bank, "undated". "Africa's Pulse, April 2013 : An Analysis of Issues Shaping Africa's Economic Future," World Bank Other Operational Studies 20238, The World Bank.
    4. Mohamed Douidich & Abdeljaouad Ezzrari & Roy Van der Weide & Paolo Verme, 2016. "Estimating Quarterly Poverty Rates Using Labor Force Surveys: A Primer," World Bank Economic Review, World Bank Group, vol. 30(3), pages 475-500.
    5. Ahmed, Faizuddin & Dorji, Cheku & Takamatsu, Shinya & Yoshida, Nobuo, 2014. "Hybrid survey to improve the reliability of poverty statistics in a cost-effective manner," Policy Research Working Paper Series 6909, The World Bank.
    6. Diana Chiliquinga & Gaurav Datt, 2016. "Changing Betas or Changing X’s? Evolution of Income and Poverty in Ecuador, 2001-12," Monash Economics Working Papers 14-16, Monash University, Department of Economics.
    7. World Bank, 2015. "Tanzania Poverty Assessment," World Bank Other Operational Studies 21871, The World Bank.
    8. Hai‐Anh Dang & Dean Jolliffe & Calogero Carletto, 2019. "Data Gaps, Data Incomparability, And Data Imputation: A Review Of Poverty Measurement Methods For Data‐Scarce Environments," Journal of Economic Surveys, Wiley Blackwell, vol. 33(3), pages 757-797, July.
    9. World Bank, "undated". "Africa's Pulse, October 2013 : An Analysis of Issues Shaping Africa's Economic Future," World Bank Other Operational Studies 20237, The World Bank.
    10. Hassine, Nadia Belhaj, 2015. "Economic Inequality in the Arab Region," World Development, Elsevier, vol. 66(C), pages 532-556.
    11. Hai-Anh H. Dang & Peter F. Lanjouw & Umar Serajuddin, 2017. "Updating poverty estimates in the absence of regular and comparable consumption data: methods and illustration with reference to a middle-income country," Oxford Economic Papers, Oxford University Press, vol. 69(4), pages 939-962.
    12. Anh Thu Quang Pham & Pundarik Mukhopadhaya & Ha Vu, 2020. "Targeting Administrative Regions for Multidimensional Poverty Alleviation: A Study on Vietnam," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 150(1), pages 143-189, July.
    13. Skoufias, Emmanuel & Diamond, Alexis & Vinha, Katja & Gill, Michael & Dellepiane, Miguel Rebolledo, 2020. "Estimating poverty rates in subnational populations of interest: An assessment of the Simple Poverty Scorecard," World Development, Elsevier, vol. 129(C).
    14. Ligon, Ethan & Christiaensen, Luc & Sohnesen, Thomas P, 2020. "Should Consumption Sub-Aggregates be Used to Measure Poverty?," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt9b9929jh, Department of Agricultural & Resource Economics, UC Berkeley.
    15. Newhouse, D. & Shivakumaran, S. & Takamatsu, S. & Yoshida, N., 2014. "How survey-to-survey imputation can fail," Policy Research Working Paper Series 6961, The World Bank.
    16. Carlo Azzarri & Elizabeth Cross, 2016. "Improved Spatially Disaggregated Livestock Measures for Uganda," The Review of Regional Studies, Southern Regional Science Association, vol. 46(1), pages 37-73, Winter.
    17. Hassine, Nadia Belhaj, 2014. "Economic inequality in the Arab region," Policy Research Working Paper Series 6911, The World Bank.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hai-Anh H. Dang & Peter F. Lanjouw & Umar Serajuddin, 2017. "Updating poverty estimates in the absence of regular and comparable consumption data: methods and illustration with reference to a middle-income country," Oxford Economic Papers, Oxford University Press, vol. 69(4), pages 939-962.
    2. Hai-Anh H. Dang & Peter F. Lanjouw, 2018. "Poverty Dynamics in India between 2004 and 2012: Insights from Longitudinal Analysis Using Synthetic Panel Data," Economic Development and Cultural Change, University of Chicago Press, vol. 67(1), pages 131-170.
    3. Dang,Hai-Anh H. & Lanjouw,Peter F. & Serajuddin,Umar & Dang,Hai-Anh H. & Lanjouw,Peter F. & Serajuddin,Umar, 2014. "Updating poverty estimates at frequent intervals in the absence of consumption data : methods and illustration with reference to a middle-income country," Policy Research Working Paper Series 7043, The World Bank.
    4. F. Clementi & A. L. Dabalen & V. Molini & F. Schettino, 2017. "When the Centre Cannot Hold: Patterns of Polarization in Nigeria," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 63(4), pages 608-632, December.
    5. Jing Dai & Stefan Sperlich & Walter Zucchini, 2011. "Estimating and Predicting Household Expenditures and Income Distributions," MAGKS Papers on Economics 201147, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    6. Newhouse, D. & Shivakumaran, S. & Takamatsu, S. & Yoshida, N., 2014. "How survey-to-survey imputation can fail," Policy Research Working Paper Series 6961, The World Bank.
    7. Channing Arndt & Azhar M. Hussain & Vincenzo Salvucci & Finn Tarp & Lars Peter Østerdal, 2016. "Poverty Mapping Based on First‐Order Dominance with an Example from Mozambique," Journal of International Development, John Wiley & Sons, Ltd., vol. 28(1), pages 3-21, January.
    8. Tarozzi, Alessandro, 2011. "Can census data alone signal heterogeneity in the estimation of poverty maps?," Journal of Development Economics, Elsevier, vol. 95(2), pages 170-185, July.
    9. Luisa Natali & Marta Moratti, 2012. "Measuring Household Welfare: Short versus long consumption modules," Papers inwopa671, Innocenti Working Papers.
    10. Jesse Naidoo, 2009. "Finite-Sample Bias and Inconsistency in the Estimation of Poverty Maps," SALDRU Working Papers 36, Southern Africa Labour and Development Research Unit, University of Cape Town.
    11. Angus Deaton & Valerie Kozel, 2005. "Data and Dogma: The Great Indian Poverty Debate," World Bank Research Observer, World Bank Group, vol. 20(2), pages 177-199.
    12. José Lombardía, María & Sperlich, Stefan, 2012. "A new class of semi-mixed effects models and its application in small area estimation," Computational Statistics & Data Analysis, Elsevier, vol. 56(10), pages 2903-2917.
    13. Backiny-Yetna, Prospère & Steele, Diane & Yacoubou Djima, Ismael, 2017. "The impact of household food consumption data collection methods on poverty and inequality measures in Niger," Food Policy, Elsevier, vol. 72(C), pages 7-19.
    14. UNDP Regional Bureau for Africa & Bruno Martorano & Giovanni Andrea Cornia, "undated". "Building an Integrated Inequality Dataset and the Seven Sins of Inequality Measurement in sub-Saharan Africa," UNDP Africa Policy Notes 2017-16, United Nations Development Programme, Regional Bureau for Africa.
    15. Skoufias, Emmanuel & Diamond, Alexis & Vinha, Katja & Gill, Michael & Dellepiane, Miguel Rebolledo, 2020. "Estimating poverty rates in subnational populations of interest: An assessment of the Simple Poverty Scorecard," World Development, Elsevier, vol. 129(C).
    16. Melanie Morten, 2006. "Indian Poverty during the 1990s: Resolving Methodological Issues from the 55th NSS Round," ASARC Working Papers 2006-07, The Australian National University, Australia South Asia Research Centre.
    17. repec:rac:ecchap:2017-16 is not listed on IDEAS
    18. Cornia, Giovanni Andrea & Martorano, Bruno, 2017. "Income Inequality Trends in sub-Saharan Africa: Divergence, determinants and consequences: Building an Integrated Inequality Dataset and the ‘Seven Sins’ of Inequality Measurement in Sub-Saharan Afric," UNDP Africa Reports 267776, United Nations Development Programme (UNDP).
    19. Dang,Hai-Anh H., 2018. "To impute or not to impute ? a review of alternative poverty estimation methods in the context of unavailable consumption data," Policy Research Working Paper Series 8403, The World Bank.
    20. Permanyer, Iñaki, 2013. "Using Census Data to Explore the Spatial Distribution of Human Development," World Development, Elsevier, vol. 46(C), pages 1-13.
    21. Tarozzi, Alessandro, 2007. "Calculating Comparable Statistics From Incomparable Surveys, With an Application to Poverty in India," Journal of Business & Economic Statistics, American Statistical Association, vol. 25, pages 314-336, July.

    More about this item

    Keywords

    Rural Poverty Reduction; Regional Economic Development; Debt Markets; Achieving Shared Growth;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:5683. 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: (Roula I. Yazigi). General contact details of provider: http://edirc.repec.org/data/dvewbus.html .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.