NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Measuring the Well-Being of the Poor Using Income and Consumption

Bruce D. Meyer, James X. Sullivan

NBER Working Paper No. 9760
Issued in June 2003
NBER Program(s):   LS   PE

We evaluate consumption and income measures of the material well-being of the poor. We begin with conceptual and pragmatic reasons that favor income or consumption. Then, we empirically examine the quality of standard data by studying measurement error and under-reporting, and by comparing micro-data from standard surveys to administrative micro-data and aggregates. We also compare low reports of income and consumption to other measures of hardship and well-being. The closer link between consumption and well-being and its better measurement favors the use of consumption when setting benefits and evaluating transfer programs. However, income retains its convenience for determining program eligibility.

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Document Object Identifier (DOI): 10.3386/w9760

Published: Meyer, Bruce D and James X. Sullivan. "Measuring The Well-Being Of The Poor Using Income And Consumption," Journal of Human Resources, 2003, v38(Supplement), 1180-1220.

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