Poverty-Adjusted Life Expectancy : A Consistent Index of the Quantity and the Quality of Life
Poverty and mortality are arguably the two major sources of loss of well-being. Most mainstream measures of human development capturing these two dimensions aggregate them in an ad-hoc and controversial way. This paper develops a new index aggregat...
| Main Authors: | , , |
|---|---|
| Format: | Working Paper |
| Language: | English English |
| Published: |
World Bank, Washington, DC
2022
|
| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/099826507292238069/IDU0dcf0c5150431e048e30af2b01041f1ae62d3 http://hdl.handle.net/10986/37790 |
| Summary: | Poverty and mortality are arguably
the two major sources of loss of well-being. Most mainstream
measures of human development capturing these two dimensions
aggregate them in an ad-hoc and controversial way. This
paper develops a new index aggregating the poverty and the
mortality observed in a given period in a consistent way. It
is called the poverty-adjusted life expectancy index. This
index is based on a single normative parameter that
transparently captures the trade-off between well-being
losses from being poor or from being dead. The paper first
shows that the poverty-adjusted life expectancy index
follows naturally from an expected life-cycle utility
approach a la Harsanyi. The paper then proceeds to empirical
comparisons between countries and across time and focuses on
situations in which poverty and mortality provide
conflicting evaluations. Once it is assumed that being poor
is (at least weakly) preferable to being dead, the analysis
finds that about a third of these conflicting comparisons
can be unambiguously ranked by the poverty-adjusted life
expectancy index. Finally, the paper shows that this index
naturally defines a new and simple index of multidimensional
poverty, the expected deprivation index. |
|---|