Robustness of Shared Prosperity Estimates : How Different Methodological Choices Matter

This paper is the first to systematically test the robustness of shared prosperity estimates to different methodological choices using a sample of countries from all regions in the world. The tests that are conducted include grouped versus microdat...

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Bibliographic Details
Main Authors:	Atamanov, Aziz, Wieser, Christina, Uematsu, Hiroki, Yoshida, Nobuo, Nguyen, Minh Cong, Wagner De Azevedo, Joao Pedro, Dewina, Reno
Format:	Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2016
Subjects:	PER CAPITA CONSUMPTION LIVING STANDARDS GROWTH RATES GROWTH RATE CONSUMER PRICE INDEX CONSUMPTION EXPENDITURES HOUSEHOLD SIZE HOUSEHOLD SURVEY SIGNIFICANT CORRELATION CAPITA INCOME POVERTY LINE FUNCTIONAL FORMS COUNTRY LEVEL ECONOMIC GROWTH BASIC EDUCATION PRICE LEVELS AGGREGATE ‐ INCOME DEVELOPING COUNTRIES DEFLATION AVERAGE GROWTH INCOME POVERTY RATES POVERTY ESTIMATES INCOME GROWTH DEVELOPMENT GOALS LABOR FORCE POVERTY HEADCOUNT WELFARE GLOBAL LEVEL NATIONAL POVERTY POLICY DISCUSSIONS DISTRIBUTION VARIABLES POVERTY INDICATORS GLOBAL POVERTY SIGNIFICANT IMPACT CONFLICT MEASURES TRENDS POVERTY REDUCTION HOUSEHOLD INCOME EMPIRICAL ANALYSIS REDUCING INEQUALITY CHOICE AVERAGE GROWTH RATE DEVELOPING WORLD WELFARE INDICATORS EMPIRICAL RESULTS ABSOLUTE DIFFERENCE PER CAPITA INCOME MEASURING POVERTY EXTREME POVERTY DATA QUALITY POVERTY INCIDENCE CRITERIA POVERTY HEADCOUNT RATES PER CAPITA GROWTH POVERTY MEASUREMENT HOUSEHOLD SURVEYS GROWTH PERFORMERS INCOME LEVELS PRODUCT UTILITY POVERTY HEADCOUNT RATE POLICY RESEARCH DEVELOPMENT POLICY INTERNATIONAL COMPARABILITY PURCHASING POWER INCOME DATA POVERTY LINES POVERTY DATA CONSUMPTION DATA AVAILABILITY POVERTY COMPARISONS POPULATION SHARE DEFLATORS POVERTY RATE LORENZ CURVE VALUE NEGATIVE INCOMES INCOME DISTRIBUTION EDUCATION LEVEL INCOMES POSITIVE CORRELATION RURAL MEASUREMENT HIGH GROWTH RATE HIGH INCOME COUNTRIES MEAN CONSUMPTION MEAN EXPENDITURE PER CAPITA GROWTH RATE EMPIRICAL RESEARCH INFLATION RATES TRADE POOR POPULATION ABSOLUTE TERMS TRADE‐OFFS SIGNIFICANT DIFFERENCES POVERTY GINI COEFFICIENT HOUSEHOLD CONSUMPTION COUNTRY SPECIFIC HIGH GROWTH POOR PRIMARY EDUCATION OPERATIONAL WORK DEVELOPMENT INDICATORS MIDDLE INCOME COUNTRIES PRICES INEQUALITY GROWTH NEGATIVE CORRELATION
Online Access:	http://documents.worldbank.org/curated/en/2016/03/26089784/robustness-shared-prosperity-estimates-different-methodological-choices-matter http://hdl.handle.net/10986/24152

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Summary:	This paper is the first to systematically test the robustness of shared prosperity estimates to different methodological choices using a sample of countries from all regions in the world. The tests that are conducted include grouped versus microdata, nominal welfare aggregate versus adjustment for spatial price variation, and different treatment of income with negative and zero values. The empirical results reveal an only minimal impact of the proposed tests on shared prosperity estimates. Nevertheless, there are important caveats. First, spatial adjustment can change the ranking of households, affecting the distribution of the population in the bottom 40 percent. Second, the negligible impact of spatial deflation holds only if price adjustments are carried out consistently over time. Finally, the treatment of negative and zero income numbers can potentially lead to substantial differences in shared prosperity, depending on the magnitude of negative income and the share of households with negative and zero numbers across years.

Robustness of Shared Prosperity Estimates : How Different Methodological Choices Matter

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