Economic Analysis: Theory and Practice
 

Analysis and assessment of poverty parameters by expert methods

Vol. 17, Iss. 6, JUNE 2018

Received: 13 March 2018

Received in revised form: 23 March 2018

Accepted: 16 April 2018

Available online: 30 June 2018

Subject Heading: ANALYSIS OF HUMAN CAPITAL

JEL Classification: D31, D63, E21, Е64, I32

Pages: 1088–1099

https://doi.org/10.24891/ea.17.6.1088

Zhmachinskii V.I. Volga State University of Water Transport, Nizhny Novgorod, Russian Federation
economcaf@vgavt-nn.ru

ORCID id: not available

Cherneva R.I. Volga State University of Water Transport, Nizhny Novgorod, Russian Federation
renden@mail.ru

ORCID id: not available

Importance When solving the problems of social and economic development, assessment and comparison of different household incomes are extremely important. Equivalence scales help make them comparable. The expert method of building equivalence scales enables to use different indicators to measure income (expenditures) of households.
Objectives The accuracy of income comparison influences the adequacy of poverty assessment, degree of stratification of society, and, as a consequence, the choice of focal points of social policies of the State. Direct comparison of different household incomes (or expenditures) does not provide precise conclusions.
Methods Usually, equivalence scales are represented as a set of dimensionless numbers. For a household taken as a base, the scale is equal to one. The values of equivalence scale for other households indicate how much their incomes should be higher or lower than the base so that their living standards are the same.
Results We developed a new system of indicators for the equivalence scale to measure incomes of households with different number of people. The paper proves that income and living standards are related to labor productivity. We improved approaches to the classification of indicators assessing the life quality and the formation of consumer goods basket, using equivalence scales in measuring household income.
Conclusions The expert method of equivalence scales enables to adequately measure the level of poverty and adapt the findings to a region, territory and social policy objectives. The offered tool can help implement socio-economic programs.

Keywords: living standards, average income, parity income, equivalence scale, subsistence wage

References:

  1. Plyshevskii B. [Poverty: Methods of analysis and economic policy]. Ekonomist = Economist, 2013, no. 3, pp. 36–45. (In Russ.)
  2. Rimashevskaya N.M., Karapetyan S.A. et al. Sem'ya i narodnoe blagosostoyanie v razvitom sotsialisticheskom obshchestve [Family and national well-being in developed socialist society]. Moscow, Mysl' Publ., 1985, 237 p.
  3. Atkinson A. Bednost'. V kn.: Ekonomicheskaya teoriya [Poverty. In: Social Economics. Ed. by J. Eatwell, M. Milgate, P. Newman]. Moscow, INFRA-M Publ., 2004, 944 p.
  4. Kukushkin A.A., Poduzov D.K. [Equivalence scales in income measurement]. Problemy prognozirovaniya = Problems of Forecasting, 2000, no. 4, pp. 42–59. (In Russ.)
  5. Cherneva R.I. [Minimum wage in the regulation of the level and quality of life]. Ekonomika i predprinimatel'stvo = Journal of Economy and Entrepreneurship, 2014, no. 12, pp. 468–473. (In Russ.)
  6. Mkhitaryan B.C., Movsisyan V.K. [Analysis of types of consumer behavior and distribution of population of the Republic of Armenia by per capita income]. Ekonomika, statistika i informatika. Vestnik UMO = Economics, Statistics and Informatics. UMO Bulletin, 2006, no. 2, pp. 36–45. (In Russ.)
  7. Bornukova K., Chubrik A., Shimanovich G. Otsenka shkaly ekvivalentnosti dlya belorusskikh domokhozyaistv i ee vliyaniya na opredelenie sotsial'no uyazvimykh grupp naseleniya [Assessing the equivalence scale for Belorussian households and its impact on the definition of vulnerable groups of population]. URL: Link (In Russ.)
  8. Agabekova N., Novoselova S. [Statistical assessment of household's economic advantages from the cohabitation in the Republic of Belarus]. Voprosy Statistiki, 2007, no. 3, pp. 15–19. (In Russ.)
  9. Ovcharova L.N. [Theoretical and methodological issues of definition and measurement of poverty]. SPERO, 2012, no. 16, pp. 15–38. (In Russ.)
  10. Slobodenyuk E.D. [Institutional factors of chronic poverty formation in modern Russia]. Journal of Institutional Studies, 2014, vol. 6, no. 3, pp. 146–159. (In Russ.)
  11. Zhmachinskii V.I., Cherneva R.I. [Living standard evaluation technique] Ekonomicheskii analiz: teoriya i praktika = Economic Analysis: Theory and Practice, 2016, no. 9, pp. 55–67. URL: Link (In Russ.)
  12. Fedorova L. [On social policy efficiency]. Ekonomist = Economist, 2014, no. 4, pp. 60–64. (In Russ.)

View all articles of issue

 

ISSN 2311-8725 (Online)
ISSN 2073-039X (Print)

Journal current issue

Vol. 17, Iss. 10
October 2018

Archive