Imputing rent in consumption measures,with an application to consumption poverty in Canada, 1997–2009

We consider two econometric problems in the measurement of poverty, both relating to rent imputation. First, we account for quality differences correlated with selection into owner‐occupied versus rental tenure. This correction increases estimated household consumption by 5% over uncorrected estimates and decreases estimated poverty rates quite dramatically. Second, we propose that measurement error induced by the imputation be corrected by imputing a consumption distribution, rather than a consumption level, for each household. This correction increases estimated poverty rates slightly. We use our methods to measure consumption poverty in Canada, and find that the imputation strategy used influences the patterns observed. For example, measured poverty among the elderly barely declines when one uses our methods, in contrast to the almost 6 percentage point reduction we find using traditional methods. In our assessment of the over‐time evolution of consumption poverty, we find that substantial progress has been made on overall poverty and on child poverty, but that poverty among the elderly hardly changed.     

The Hunger of Old Women in Rural Tanzania: Can Subjective Data Improve Poverty Measurement?

On average, women in Tanzania are slightly less likely than men to say that they are “always/often without enough food to eat”—but this masks a much higher rate of self‐reported food deprivation among elderly rural women. Official Tanzanian poverty statistics are, however, based on a methodology which presumes equal sharing per equivalent adult within the household. This paper combines subjective and objective micro‐data from Tanzania's 2007 Household Budget Survey and 2007 Views of the People Survey. By imputing individual consumption based on the relative probability of self‐reported food deprivation, it provides an example of the possible importance of one type of intra‐household inequality—i.e., the hunger of old women—for poverty measurement. Implications include the complexity of gendered intra‐household inequality and the importance of “technical” poverty measurement choices for public policy priorities, such as old age pensions.     

Relative price shifts,economies of scale and poverty during economic transition1

Economic transition is associated with significant shifts in relative prices between private and public goods. If, as a result, public goods claim a larger share of total expenditures, economies of scale in consumption increase. We show how relative price changes might alter the welfare of different‐sized households in the short run and over time. We illustrate, for a selection of transition economies, that conventional poverty profiles are quite sensitive to assumptions made about economies of scale in consumption. In particular, the common view that large households with many children are poor relative to small households (such as those comprising the elderly) is shown to be highly non‐robust.     

Domestic technology,consumption economies of scale and poverty: evidence from Sri Lanka

While it is well known that new technologies enhance consumer welfare, the manner in which these technologies impact the ability to realize economies of scale in consumption is not well understood. We use Sri Lankan household data to examine how the adoption of new technologies by households positively impacts their ability to achieve household economies of scale. This suggests that new technologies not only deliver a greater variety of consumption goods to consumers, but they may also play an important role in enabling large households to escape poverty by lowering the per-capita costs of maintaining a given standard of living. Given the importance of consumption economies of scale in the measurement of poverty, this study provides some insights on the extent to which the number of poor households changes when food consumption scale economies due to technology adoption in the domestic sphere are incorporated.     

Expenditure on children: A Rothbarth-type method consistent with scale economies and parents' bargaining

We suggest a new methodology to estimate the share of household income accruing to children. The household behavior is represented according to the collective approach. That is, each household member is characterized by specific preferences. Following the principle of the Rothbarth approach, the identification of the children's share requires the observation of adult-specific goods. Our method differs from this traditional approach in that it is compatible with economies of scale as well as with parents' bargaining. We illustrate the method with an application to the French Household Budget Survey.     

FROM MARGINALISM TO INSTITUTIONALISM: DISTRIBUTIONAL CONSEQUENCES OF THE TRANSFORMATION OF THE FINNISH PENSION REGIME

This study offers a longitudinal scrutiny of the development of pension policy in Finland and evaluates the impacts that the shift from a "marginal" to an "institutional" welfare state imposed on economic well-being among the elderly. The data that are used stem from household budget surveys from 1966 to 1990. During that period, average income of the elderly doubled in real terms, legislated pensions replaced other sources of income, the traditional cycle of poverty, where the elderly had a higher risk of poverty, disappeared, and income differences between the elderly diminished.     

The collective good motive for immigration policy

The authors consider immigration policy in the particular setting of scale economies in consumption. A model of a jurisdiction with a collective good motive for instituting an immigration policy is developed, and comparative statistical results are derived     

Do socially motivated self‐help groups perform better? Exploring determinants of micro‐credit groups’ performance in Eastern India

Group‐based micro‐credit initiatives, as part of the broader social and solidarity‐based finance initiatives, have gained prominence over the past decade, especially in developing economies like India. Lending to the poor, especially women, through micro‐credit groups, are significantly associated with the utilization of commons. Apart from their financial operations, self‐help groups promote social empowerment activities and collective action following a dual bottom‐line approach. However, the causal role of the group's motivation towards pursuing social objectives has not been explored in the past. The present study, therefore, investigates the interlinkages between the group's intrinsic motivation and efficiency using an innovative two‐stage double bootstrapped DEA‐based methodology. Results from the study affirm that apart from traditional factors like maturity, accessibility and group management, the motivation of the group is a crucial determinant of social efficiency. Additionally, the group's loan‐to‐savings ratio and receipt of cash payments significantly affect its long‐term financial sustainability. Micro‐credit groups cannot contribute sustainably as a viable alternative to traditional means of access to credit if it merely offers innovative forms of financing and consumption. They need to be socially aligned to serve the community better and contribute to the group's overall performance and galvanize community‐based resource management.     

HOUSEHOLDS, GOODS, AND WELL-BEING

Household economies translate goods into well-being through production, co-operation, and distribution. Between market goods to households and well-being to persons, value is added. Income is a measure of goods, consumption well-being is measured by equivalent income. An absolute interpretation of equivalent income is argued as the value to persons of consumption well-being after household economies. Guidance is suggested on the choice of equivalence scales, and for the measurement of well-being and inequality.     

Oil consumption and economic efficiency: A comparative analysis of advanced, developing and emerging economies

This paper investigates the economic efficiency-oil consumption relationship in 42 countries during the period 1986-2006. In a first stage by using DEA window analysis countries' economic efficiencies are obtained. In a second stage an econometric analysis based on robust GMM estimators reveals an inverted ‘U’-shape relationship between oil consumption and economic efficiency. In order to capture heterogeneities among countries' development stages the analysis has been separated into two groups (advanced economies and developing/emerging economies). The results show that advanced economies have much higher turning points compared to emerging and developing economies. It appears that oil consumption increases countries' economic efficiency. In addition the consumption patterns of oil products and its derivatives have changed through years and among countries. The different turning points from the econometric analysis indicate the dependence of oil consumption in advanced economies (higher turning points) is driven mainly by household purchasing activities and their standards of living (transport, housing and water, food, etc.). Finally, it appears that oil consumption is the main driver behind the progress of industrialization and urbanization regardless of the country's development stage.     

Patterns of poverty among elderly Americans: a latent class Markov model

This article studies poverty persistence and the role of social security programmes on poverty among elderly in the US. We use a Latent Markov model to disentangle unobserved heterogeneity and state dependence. Because of its dynamic nature, unobserved heterogeneity is modelled to vary over time. This allows to capture different latent states of poverty that change over time. Result indicates the existence of three unobserved types evolving over time according to their propensity to be poor. Moreover, a strong persistence in poverty especially for women, individuals living alone and ethnic minorities is found. Finally, the estimates indicate that giving social assistance tends to reduce poverty.     

INTERPRETING CHANGES IN THE ECONOMIC STATUS OF THE ELDERLY, 1949-1979

This paper analyzes changes in the economic well-being of the elderly using data from the Decennial Censuses of 1950 through 1980. We find that the economic status of each elderly cohort is higher on average than that of the preceding cohort. Certain events associated with age–retirement for both men and women and widowhood for women–are associated with declining incomes. Controlling for sex, labor force participation, and marital status, however, the economic well-being of elderly cohorts generally increases with age.     

Does Off-Farm Wage Employment Make Women in Rural Senegal Happy?

This paper investigates the impact of wage employment on women’s well-being in the Senegalese horticultural export industry. It uses a subjective well-being approach, based on self-reported happiness, to capture income and non-income aspects of employment. The study uses original survey data from 2013 for the Saint-Louis region in Senegal and an instrumental variable approach, supported by information from focus group discussions. It finds that women’s employment improves subjective well-being for the poorest women, but not for women whose household income is above the poverty threshold. Women’s employment improves women’s happiness through an income effect, as it leads to higher income levels and improved living standards, but the non-income effects reduce women’s happiness. This negative effect is related to a higher workload and low job satisfaction due to unfulfilled expectations. The positive income effect outweighs these negative non-income effects for poor women but not for relatively wealthier women.     

How to Compare Apples And Oranges: Poverty Measurement Based on Different Definitions of Consumption

Poverty rates calculated on the basis of household consumption expenditures are routinely compared across countries and time. The surveys which underlie these comparisons typically differ in the types of food and non-food expenditures included, often in ways which are easily overlooked by analysts. With several examples we demonstrate that these commonly occurring variations in expenditure definitions can give rise to marked differences in poverty rates where there are no real differences in well-being. We show that one approach to calculating poverty lines, used with the headcount measure of poverty, can allow comparisons based on data with different definitions of consumption. In addition to allowing comparative poverty analysis using existing survey data, the results suggest that poverty monitoring could be done effectively at lower cost by alternating detailed expenditure surveys with far more abbreviated surveys.     

Unemployment duration,Fiscal and monetary policies,and the output gap: How do the quantile relationships look like?

We use country-level panel data on average unemployment duration (AvgUD) to explore how the conditional distribution of AvgUD varies with primary fiscal balance (fiscal policy), short-term interest rate (monetary policy), and the state of the business cycle (output gap). We obtain the quantile estimates via a Bayesian quantile mixed effects model, which has so far received limited attention in economics. Our results reveal rich heterogeneity in both the sign and strength of these associations at different quantiles of AvgUD, in different gender and age groups, and in some transition economies that have markedly different labour markets. A higher fiscal balance/surplus is associated with higher middle-upper quantiles of AvgUD among prime-age and old-age men, whereas the empirical association is weak at all quantiles of AvgUD among young men and women. The association between quantiles of AvgUD and fiscal and monetary policies tends to be weaker among women than men. A better state of the business cycle is associated with a lower AvgUD at all quantiles among young men and women.     

Gender roles,labour market participation and household income position

In empirical research on labour supply behaviour, variables like age, education or the household's financial situation as well as economic and demographic characteristics, social attitudes and gender role schemes are believed to influence the annual working hours. This paper starts from the assumption that these determinants work differently according to the poverty level of the household in which the individual lives. Using data from the German Socio-Economic Panel (GSOEP), the paper empirically tests this hypothesis for women and men living in households with a disposable income above the poverty line and of those living in poor households. The results of multiple regression analysis show traditional gender role patterns in labour supply decisions, but only for persons in households with an income above the poverty line.     

Intrahousehold moral hazard frictions and household poverty traps in rural India

We empirically study the role of assets held by women in the creation of household wealth using data from rural India. We design a streamlined model of intrahousehold project funding where moral hazard frictions between spouses and women's asset control are the main ingredients. As predicted by the model, the data show that household asset accumulation depends on women's asset control in a non-monotonic way. Results indicate no presence of multiple equilibrium poverty traps, but do show that exogenous negative shocks will trigger assets aggregation within households where both spouses are present. This resilience mechanism is, however, not found in female headed household as these households have a monotonic relationship between women's wealth control and asset creation. We thus argue that policies to support women's empowerment need to distinguish women based on their individual wealth levels and headship status to enhance household well-being in remote Indian communities.     

Travel patterns and environmental effects now and in the future:: implications of differences in energy consumption among socio-economic groups

Travel patterns among different socio-economic groups in Sweden are investigated. It is shown that elderly persons, persons with low incomes and women in general do not travel extensively. Middle-aged persons, persons with high incomes and men travel much farther. Cars are the dominant transportation mode for all population groups. Aeroplanes are used mostly by high-income earners and men, while public transportation is mostly used by young people and women. Energy consumption for the different travel patterns differs substantially. Men with high incomes consume the most energy, with 94 000 MJ during one year, while elderly women consume 12 000 MJ. When compared to a calculated sustainable level of energy consumption for travel, most population groups are in excess. The level for sustainable energy consumption is calculated based on an assumed global potential for renewable energy of 360 EJ per year, divided equally among the global population. A certain share of this energy potential is supposed to be used for travelling. A scenario for 2020 is presented in which vehicle energy efficiency has increased and travel patterns have changed from what they are today. Sustainability can only be reached when both travel patterns and vehicle technology have changed radically. Differences in energy consumption for travel due to age and gender are likely to remain in the future. Scientific knowledge from the social domains seems to be important for devising efficient strategies for a sustainable society. Current focus on policy measures has been mainly on technical issues.     

Industrial organization implications of QR trade regimes: Evidence and welfare costs

Evidence of the relationship between trade regimes, concentration and profitability in semi-industrial countries' manufacturing sectors is reviewed. This evidence is used to justify the formulation and simulation of a three sector general equilibrium model in which the manufacturing sectors's behavior is linked to the degree of restrictiveness of the QR regime. Simulations are conducted with several variants of the model to ascertain separately the effects of introducing economies of scale, firm entry/exit, departures from competitive pricing, and interactions between entry and pricing rules. Numerical results suggest that a 20 percent rationing rate of intermediates and consumption goods can have welfare costs of about 2.0 percent of national income in the absence of economies of scale and industrial organization interactions with the trade regime. When industrial organization features are included, the costs of the same 20 percent rationing quadruples.     

Does intrahousehold bargaining power enhance women's marital satisfaction? A perspective from two competing forces in China

In the context of two competing forces (i.e., socioeconomic transformation vs. traditional cultural norms) influencing Chinese family and its members, the paper uses the China Family Panel Studies (CFPS) to empirically examine the causal relation between intrahousehold bargaining power and women's marital satisfaction. By employing an instrumental variable approach, the paper finds that intrahousehold bargaining power negatively affects women's marital satisfaction. This conclusion remains valid after performing various robustness checks. However, there are some heterogeneous effects found that the negative effect is particularly significant among those women of higher age and constrained by external traditional norms. These women are more conservative in their own thoughts and thus tend to support the traditional gender belief of “men being the masters of the family.”