The measurement of household welfare is one of the most compelling yet demanding areas in economics. To place the analysis of inequality and poverty within an economic framework where individuals are making decisions about current and lifetime incomes and expenditures is a difficult task, made all the more challenging by the complexity of the decision-making process in which households are involved and the variety of constraints they face. This 1994 book examines the conceptual and practical difficulties of making inferences from observed behaviour. It addresses the problems of making comparisons across a range of very different households and discusses how data for such comparisons should be collected. The contributions, from experts from Europe, North America and Australia, have the unifying theme that there is a strong relationship between theoretical concepts from microeconomics and the appropriate use of micro data in evaluating household welfare.
• Survey of developments in the measurement of the welfare of households • Contains advances on a variety of subjects in the field • The contributors are well-known figures in the field from around the world, several with links to the prominent Institute for Fiscal Studies
1. An introduction to applied welfare analysis Richard Blundell, Ian Preston and Ian Walker; 2. Measuring the costs of children: a theoretical framework Charles Blackorby and David Donaldson; 3. The collective approach to household behaviour Francois Bourguignon and Pierre-Andre Chiappori; 4. Ordinal and cardinal utility: an integration of the two dimensions of the welfare concept Bernard Van Praag; 5. The determination of welfare in nonintact families Daniela Del Bocha and Chris Flinn; 6. Female labour supply, housework and family welfare Patricia Apps; 7. Engel equivalence scales in Sri Lanka: exactness, specification, measurement error Mamta Murthi; 8. Measuring the life-cycle consumption costs of children James Banks, Richard Blundell and Ian Preston; 9. Family fortunes in the 1970s and 1980s Fiona Coulter, Frank Cowell and Stephen Jenkins; 10. Ethically consistent welfare prescriptions are reference-price-independent Charles Blackorby, Francois Laisney and Rolf Schmachtenberg; 11. The effect of systematic misperception of income on the subjective poverty line Martijn Tummers.