Title

Multidimensional poverty measurement with individual preferences

Author(s)

Koen Decancq Koen Decancq (University of Antwerp)

Marc Fleurbaey Marc Fleurbaey (Princeton University)

Francois Maniquet Francois Maniquet (Universit e Catholique de Louvain)

Abstract

We propose a new class of multidimensional poverty indices. To aggregate and weight the different dimensions of poverty, we rely on the preferences of the concerned agents rather than on an arbitrary weighting scheme selected by the analyst. The Pareto principle is, therefore, satisfied among the poor. The indices add up individual measures of poverty that are computed as a convex transform of the fraction of the poverty line vector to which the agent is indifferent. The axiomatic characterization of this class is grounded on new principles of interpersonal poverty comparisons and of inequality aversion among the poor. We illustrate our approach with Russian survey data between 1995 and 2005. We find that, compared to standard poverty indices, our preference sensitive indices lead to considerable differences in the identification of the poor and in subgroup poverty comparisons.

Creation Date

2014-01

Section URL ID

Paper Number

058-2014

URL

http://detc.princeton.edu/wp-content/uploads/2016/11/wp058_2014_Decancq_Fleurbaey_Maniquet_Multidimensional-poverty-measurement-with-individual-preferences.pdf

File Function

Jel

D63, D71

Keyword(s)

Suppress

false

Series

10