Frame-of-Reference Bias in Subjective Welfare Regressions

Frame-of-Reference Bias in Subjective Welfare Regressions

Past research has found that subjective questions about an individuals' economic status do not correspond closely to measures of economic welfare based on household income or consumption. Survey respondents undoubtedly hold diverse ideas about...

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Bibliographic Details
Main Authors:	Beegle, Kathleen, Himelein, Kristen, Ravallion, Martin
Format:	Policy Research Working Paper
Language:	English
Published:	2012
Subjects:	AGRICULTURE DESCRIPTION DEVELOPMENT ISSUES DEVELOPMENT RESEARCH DIET ECONOMIC DEVELOPMENT ECONOMIC PERFORMANCE ECONOMIC RESEARCH ECONOMIC REVIEW ECONOMICS EMPLOYMENT STATUS EXTREME POOR HOUSEHOLDS EXTREME POVERTY FARMLAND FEMALE FEMALE HEADED HOUSEHOLDS FEMALE-HEADED HOUSEHOLDS FISH FOOD POVERTY FOOD POVERTY LINE FOOD SECURITY FOOD SPENDING GENDER HOUSEHOLD CHARACTERISTICS HOUSEHOLD CONTROLS HOUSEHOLD DEMOGRAPHICS HOUSEHOLD HEAD HOUSEHOLD HEAD AGE HOUSEHOLD INCOME HOUSEHOLD SIZE HOUSEHOLD SURVEY INCOME DISTRIBUTION INCOME EFFECT INCOME INEQUALITY INCOME LEVELS INCOMES INTERNATIONAL POVERTY LINE LIVESTOCK LIVING CONDITIONS LIVING STANDARDS LIVING STANDARDS MEASUREMENT LIVING STANDARDS SURVEY MEASURING POVERTY NON-FOOD COMPONENT OCCUPATION PER CAPITA INCOME PERMANENT INCOME POLICY RESEARCH POOR POOR AREAS POOR HOUSEHOLDS POOR PEOPLE POOR PERSON POVERTY LINE PUBLIC GOOD PURCHASING POWER REAL INCOME RURAL SOCIAL SCIENCES SUBJECTIVE POVERTY UNEMPLOYMENT URBAN AREAS UTILITY FUNCTION WEALTH WELFARE COMPARISONS WELFARE FUNCTION
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090929133925 http://hdl.handle.net/10986/4258

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Summary:	Past research has found that subjective questions about an individuals' economic status do not correspond closely to measures of economic welfare based on household income or consumption. Survey respondents undoubtedly hold diverse ideas about what it means to be "poor" or "rich." Further, this heterogeneity may be correlated with other characteristics, including welfare, leading to frame-of-reference bias. To test for this bias, vignettes were added to a nationally representative survey of Tajikistan, in which survey respondents rank the economic status of the theoretical vignette households, as well as their own. The vignette rankings are used to reveal the respondent's own scale. The findings indicate that respondents hold diverse scales in assessing their welfare, but that there is little bias in either the economic gradient of subjective welfare or most other coefficients on covariates of interest. These results provide a firmer foundation for standard survey methods and regression specifications for subjective welfare data.