According to the catastrophic health expenditure methodology a household is in catastrophe if its health out-of-pocket budget share exceeds a critical threshold. We develop a conceptual framework for addressing three questions in relation to this methodology, namely: 1. Can a budget share be...

We use the delta method to derive the large sample distribution of multidimensional inequality indices. We also present a simple method for computing standard errors and obtain explicit formulas in the context of two families of indices

The standard approach to the study of poverty assumes the existence of an ideal variable that captures the extent of deprivation. In this paper we postulate that poverty is involved with many dimensions. We use a latent variable framework to predict the extent of an individual's hardship as a...

We provide, for the class of relative bidimensional inequality indices, adecomposition of inequality into two univariate Atkinson-Kolm-Senindices and a third statistic which depends on the joint distribution ofresources

The amp;apos'prediction approachamp;apos' proposed by Dearden, Machin and Reed (DMR) consists in (1) regressing the observed incomes of the child and parent families on separate sets of predetermined variables, and (2) regressing the childamp;apos's predicted income on that of the parents....

Averaging methods are routinely used in order to limit biases resulting from the mismeasurement of permanent incomes. The Solon/Zimmerman estimator regresses a single-year measurement of the childamp;apos's resources on a T-period average of the parentsamp;apos' income while the Behrman/Taubman...

Because the permanent incomes of parents and children are typically unobserved, the estimation of the intergenerational correlation via the use of proxy variables entails an errors-in-variables bias. By solving a system of moment equations for income observed at a given year, and a T-period...

The estimation of the intergenerational correlation of incomes is usually carried out by proxying permanent incomes using suitable indicators of economic status, and by treating the resulting measurement error problem using averaging or instrumenting procedures. Here we take the permanent income...

This paper is about the determination and prediction of permanent income in household data. Standard static welfare indicators (e.g. per capita expenditure and income) are imperfect in this respect as they typically contain a high transitory component. The framework we employ is consistent with...

We consider the problem of targeting benefits when the incomes of families are not accurately observable by the public authorities. By income uncertainty it is meant that the decision-maker cannot ascertain an applicantamp;apos's income, but that he can assign probabilities with respect to the...