handbook on poverty and inequality - isbn: 9780821376133

Handbook on Poverty and Inequality

Handbook on Povertyand Inequality

Jonathan HaughtonShahidur R. Khandker

© 2009 The International Bank for Reconstruction and Development/The World Bank1818 H Street, NWWashington, DC 20433Telephone: 202-473-1000Internet: www.worldbank.orgE-mail: [email protected]

All rights reserved

1 2 3 4 12 11 10 09

This volume is a product of the staff of the International Bank for Reconstruction and Development/TheWorld Bank. The findings, interpretations, and conclusions expressed in this volume do not necessarilyreflect the views of the Executive Directors of The World Bank or the governments they represent.

The World Bank does not guarantee the accuracy of the data included in this work. The boundaries,colors, denominations, and other information shown on any map in this work do not imply any judge-ment on the part of The World Bank concerning the legal status of any territory or the endorsement oracceptance of such boundaries.

Rights and PermissionsThe material in this publication is copyrighted. Copying and/or transmitting portions or all of this workwithout permission may be a violation of applicable law. The International Bank for Reconstruction andDevelopment/The World Bank encourages dissemination of its work and will normally grant permissionto reproduce portions of the work promptly.

For permission to photocopy or reprint any part of this work, please send a request with complete infor-mation to the Copyright Clearance Center Inc., 222 Rosewood Drive, Danvers, MA 01923, USA; telephone:978-750-8400; fax: 978-750-4470; Internet: www.copyright.com.

All other queries on rights and licenses, including subsidiary rights, should be addressed to the Officeof the Publisher, The World Bank, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2422;e-mail: [email protected].

ISBN: 978-0-8213-7613-3eISBN: 978-0-8213-7614-0DOI: 10.1596/978-0-8213-7613-3

Library of Congress Cataloging-in-Publication Data

Haughton, Jonathan Henry.Handbook on poverty and inequality / Jonathan Haughton and Shahidur R. Khandker.

p. cm.Includes bibliographical references and indexes.ISBN 978-0-8213-7613-3—ISBN 978-0-8213-7614-0 (electronic)1. Poverty—Statistical methods. 2. Poverty—Econometric models. 3. Equality— Economic aspects—

Econometric models. I. Khandker, Shahidur R. II. Title.HC79.P6H344 2009339.4'60727—dc22

2009000849Cover design: Patricia Hord.Graphik Design

v

Contents

Preface xv

Foreword xvii

About the Authors xix

Abbreviations xxi

1 What Is Poverty and Why Measure It? 1

Summary 1

Learning Objectives 2

Introduction: The Concepts of Well-Being and Poverty 2

Why Measure Poverty? 3

Thinking Systematically: Poverty Reduction Strategy Papers 6

Notes 7

References 7

2 Measuring Poverty 9

Summary 9


Introduction: Steps in Measuring Poverty 10

Household Surveys 11

Measuring Poverty: Choosing an Indicator of Welfare 20

Notes 35

References 35

3 Poverty Lines 39

Summary 39


Introduction: Defining a Poverty Line 40

Issues in Choosing an Absolute Poverty Line 46

Solution A: Objective Poverty Lines 49

Contents

Solution B: Subjective Poverty Lines 60

Notes 64

References 64

4 Measures of Poverty 67

Summary 67


Introduction 68

Headcount Index 68

Poverty Gap Index 70

Squared Poverty Gap (Poverty Severity) Index 71

Sen Index 74

The Sen-Shorrocks-Thon Index 74

The Watts Index 77

Time Taken to Exit 78

Other Measures 80

References 81

5 Poverty Indexes: Checking for Robustness 83

Summary 83


Introduction 84

Sampling Error 85

Measurement Error 87

Equivalence Scales 89

Choice of Poverty Line and Poverty Measure 92

A Single Measure of Standard of Living 93

Note 100

References 100

6 Inequality Measures 101

Summary 101


Introduction: Definition of Inequality 102

Commonly Used Summary Measures of Inequality 103

Inequality Comparisons 108

Measuring Pro-Poor Growth 110

Decomposition of Income Inequality 111

Income Distribution Dynamics 115

Note 119

References 119vi

Contents

7 Describing Poverty: Poverty Profiles 121

Summary 121


Introduction: What Is a Country Poverty Profile? 122

Additive Poverty Measures 126

Profile Presentation 126

Poverty Comparisons over Time 127

Excerpts from Poverty Profiles for Indonesia and Cambodia 130

Poverty Mapping 136

Automating Poverty Profiles: The ADePT 2.0 Program 140

Note 143

References 143

8 Understanding the Determinants of Poverty 145

Summary 145


Introduction: What Causes Poverty? 146

Household and Individual-Level Characteristics 149

Analyzing the Determinants of Poverty: Regression Techniques 152

Note 158

References 158

9 Poverty Reduction Policies 161

Summary 161


Introduction 162

Is Growth Good for the Poor? 162

Pro-Poor Growth 165

An Example: Tanzania 175

Note 179

References 179

10 International Poverty Comparisons 181

Summary 181


Introduction 182

Overview of Poverty Analysis 183

International Poverty Comparisons 184

Survey Data and National Accounts 191

Debate 1: Is World Poverty Falling? 194

Debate 2: Is World Poverty Really Falling? 196 vii

Contents

Conclusion 200

Notes 201

References 201

11 The Analysis of Poverty over Time 203

Summary 203


Introduction: Sources of Information on Poverty over Time 204

Advantages of Panel Surveys 208

Drawbacks of Panel Surveys 211

Other Issues in Panel and Repeated Cross-Sectional Data 213

Chronic versus Transient Poverty 214

Case Study: The Asian Financial Crisis and Poverty in Indonesia 218

Poverty Transition Matrix, December 1998–August 1999 227

Notes 227

References 228

12 Vulnerability to Poverty 231

Summary 231


Introduction: Why Measure Vulnerability? 232

Vulnerability to Poverty Defined 234

Quantifying Vulnerability to Poverty 236

Sources of Vulnerability 243

Lessons from Studies of Vulnerability to Poverty 246

Notes 247

References 247

13 Poverty Monitoring and Evaluation 249

Summary 249


Introduction 250

Poverty Monitoring 251

Impact Evaluation: Micro Projects 256

Impact Evaluation: Macro Projects 268

Notes 271

References 271

14 Using Regression 273

Summary 273

Learning Objectives 274viii

Contents

Introduction 274

The Vocabulary of Regression Analysis 276

Examining a Regression Example 277

Problems in Regression Analysis 279

Solving Estimation Problems 285

Logistic Regression 287

Note 291

References 291

15 The Effects of Taxation and Spending on Inequality and Poverty 293

Summary 293


Introduction 294

Presenting Incidence Results 295

Tax Incidence 300

Benefit Incidence 305

Issues in Benefit Incidence Analysis 307

Conclusion 314

Annex A. Case Study: Health Spending in Ghana 315

Notes 317

References 317

16 Using Survey Data: Some Cautionary Tales 319

Summary 319


Introduction: Interpreting Survey Data 320

Caution 1. Do the Sampling Right 321

Caution 2. Use a Consistent Recall Method 322

Caution 3. Use a Consistent Recall Period 323

Caution 4. Remember That Price Indexes Matter (a lot) 324

Caution 5. Use Consistent Questions 328

Caution 6. Adjust for Nonresponse Bias (if possible) 329

Caution 7. Define Expenditure Consistently 331

Caution 8. Value Own-Farm Income Properly 333

Caution 9. Distinguish between Values That Are Zero and Those

That Are Missing 333

Caution 10. Use Expenditure per Capita, Not Expenditure

per Household 335

Caution 11. Use Weights When They Are Needed 335

Note 337

References 337 ix

Contents

Appendix 1 Data Introduction 339

Appendix 2 Stata Preliminary 343

Appendix 3 Exercises 369

Answers to the Review Questions 403

Index 405

Boxes2.1 Calculating the Value of Durable Goods Consumption: An Illustration 26

3.1 The “$1/Day” Standard 46

3.2 The U.S. Poverty Line 50

5.1 First-Order Stochastic Dominance, Formally 97

13.1 Case Study: Workfare and Water in Argentina 261

13.2 Case Study: Microfinance and the Poor in Bangladesh 264

16.1 Constructing Price Indexes 326

Figures2.1a Simple Random Sample 15

2.1b Cluster Sampling 15

2.2 Lifecycle Hypothesis: Income and Consumption Profile over Time 24

2.3 Engel Curve: Food Spending Rises Less Quickly Than Income 33

3.1 Poverty Lines across Countries 44

3.2 Food Expenditure Function 53

3.3 Calorie Income Function 55

3.4 Calorie Income Functions for Urban and Rural Indonesia 58

3.5 Cumulative Distribution Functions for Consumption, Indonesia, 1990 59

3.6 The Determination of Poverty Lines for Vietnam, 1993 and 1998 60

3.7 Estimating a Subjective Poverty Line 61

3.8 Self-Rated Poverty: Households That Are “Mahirap,” April 1983 to

Second Quarter 2008 61

4.1 Comparison of Canada and the United States Using the SST Index,

1971–94 75

4.2 Average Exit Time from Poverty 79

5.1 Distribution of Log of Expenditure per Capita

with and without Measurement Error, for Vietnam in 2006 89

5.2 Poverty Incidence Curves with First-Order Stochastic Dominance 94x

Contents

5.3 Poverty Deficit Curves 95

5.4 Poverty Incidence Curves Showing Ambiguous Ranking 95

6.1 Lorenz Curve 105

6.2 Pen’s Parade (Quantile Function) for Expenditure per Capita,

Vietnam, 1993 and 1998 109

6.3 Poverty Incidence Curve for Expenditure per Capita, Vietnam,

1993 and 1998 111

7.1 Headcount Poverty by Region, Cambodia, 1999 123

7.2 Poverty by Household Size, Cambodia, 1999 135

7.3 Poverty by Education Level of Household Head, Cambodia, 1999 136

7.4 Distribution of Real Expenditure per Capita, Vietnam, 2006 142

9.1 Relating the Income of the Poor to Average Incomes 164

9.2 Real GDP Growth, Tanzania, 1993–2007 (in Constant Prices) 177

11.1 Defining the Household 213

12.1 Illustrating the Probability of Poverty for a Household 237

12.2 Identifying Vulnerable Households 238

14.1 Scatter Plot and Regression Lines for Food Consumption per

Capita against Total Expenditure per Capita, Vietnam, 2006 275

14.2 A Hypothetical Example of the Link between Schooling and Wages 282

14.3 Heteroskedasticity Illustrated 284

14.4 Outliers Illustrated 285

14.5 Logistic Regression Compared with OLS 287

15.1 Histograms for Income Tax as a Percentage of Income, Three Cases 297

15.2 Lorenz and Concentration Curves for PIT Example 298

15.3 Incidence of Value Added Tax, Peru, 2000 304

15.4 The Incidence of Government Spending on Education, Peru, 2000 308

15.5 State Spending on Education by Level, Peru, 2000 309

16.1 Cumulative Distribution Functions, Southwest China Poverty

Monitoring Survey 322

16.2 Headcount Poverty Rates in India, 1970–2000 324

16.3 Correction Factors for U.S. Income 331

16.4 Cumulative Distribution of Income per Capita, Colombia, 2003 334

16.5 Cumulative Distribution of Expenditure per Capita, Benin, 2003 336

A2.1 Stata Main Window 344

Tables2.1 Illustration of Why Weights Are Needed to Compute Statistics Based

on Stratified Samples 14

2.2 Summary of per Capita Consumption from Cambodian Surveys 21

2.3 Income and Expenditure by per Capita Expenditure Quintiles, Vietnam 23 xi

Contents

2.4 Which Indicator of Welfare: Income or Consumption? 30

2.5 Poverty and Quality of Life Indicators 34

3.1 Summary of Poverty Lines for Cambodia 42

3.2 Average Poverty Line of Thailand 43

3.3 Absolute and Relative Poverty Rates 49

3.4 Illustration of Construction of Cost-of-Food Component of

Poverty Line 51

3.5 Food Consumption by Expenditure Quintile, Vietnam, 1992–93 51

3.6 Poverty Lines and Headcount Measures of Poverty, Vietnam 52

3.7 Typology of Poverty Lines in World Bank Poverty Assessments

for Africa 55

3.8 Per Capita Daily Calorie Intake Used in Poverty Line Construction 56

3.9 Headcount Measures of Poverty in Indonesia, 1990 57

3.10 Poverty Lines in Indonesia Using Food Energy Intake Method, 1990 59

4.1 Poverty Indexes by Subgroups, Madagascar, 1994 73

4.2 Decomposition of Poverty and Changes in Poverty in Newfoundland,

1984–96 76

4.3 Measures of Poverty (with a $2/day Poverty Line) and Inequality

for Selected Countries and Regions 78

5.1 Sensitivity of Headcount Poverty Rate (P0) to Different Specifications

of Adult Equivalence Scales, United States, 1999 90

5.2 Adult Equivalents, India and Taiwan, China 91

5.3 Correlation Coefficients, Expenditure per Capita with Expenditure

per Adult Equivalent 91

5.4 Classifying the Poor Using Alternative Measures of Welfare,

Vietnam, 2006 92

5.5 Sensitivity of Poverty Rate in Vietnam to Changes in the

Poverty Line, 2006 93

5.6 Comparison of Poverty Incidence and Poverty Deficit Curves

Using Different Poverty Lines 96

6.1 Breakdown of Expenditure per Capita by Quintile, Vietnam, 1993 103

6.2 Inequality in Vietnam, as Measured by the Gini Coefficient for

Expenditure per Capita, 1993 and 1998 106

6.3 Computing Measures of Inequality 108

6.4 Expenditure Inequality in Selected Developing Countries 108

6.5 Decomposition of Inequality in Expenditure per Capita by Area,

Vietnam, 1993 and 1998 113

6.6 Expected Change in Income Inequality Resulting from a 1 Percent

Change in Income (or Wealth) Source, 1997 (as Percentage

of Change in Gini Coefficient), Peru 114

6.7 Decomposition of Income Inequality in Rural Egypt, 1997 115xii

Contents

6.8 Economic Indicators for Brazil, 1976 and 1996 117

7.1 Selected Characteristics of the Poor in Ecuador, 1994 124

7.2 Poverty among Household Groups in Malawi, 1997–98 124

7.3 Poverty Measures for Cambodia, 1993/94 and June 1997 128

7.4 Poverty Risks for Selected Groups of Households, Peru 129

7.5 Sectoral Poverty Profile for Indonesia, 1987 131

7.6 Sectoral Decomposition of the Change in Poverty in

Indonesia, 1984–87 132

7.7 Comparisons of Poverty Estimates from Cambodian Surveys 133

7.8 Distribution of Poverty by Age and Gender of Household Head

in Cambodia, 1999 134

7.9 Mean and Standard Error of Headcount Poverty Rate for Different

Sample Sizes, Rural Costa Province, Ecuador, 1994 139

7.10 Standard Errors of Estimates of Headcount Poverty Rates, for

Survey Data and for Small-Area Estimation, Ecuador, 1994 140

7.11 Decomposition of Inequality (in Expenditure per Capita) by Urban

and Rural Areas, in Vietnam, 2006 141

8.1 Main Determinants of Poverty 153

8.2 Determinants of Household Spending Levels in Côte d’Ivoire,

about 1993 155

9.1 Growth Determinants and the Incomes of the Poor 165

9.2 Growth and Distribution Effects of Poverty 167

9.3 Summary of Tanzania’s National Strategy for Growth and

Reduction of Poverty (MKUKUTA) 176

10.1 Headcount Indexes: Percentage of Population in Developing

Countries Living below $1.25/Day 185

10.2 Computing GDP per Capita in Purchasing Power Parity (PPP) Terms 187

10.3 Illustrating the Effects of Response Bias and Underreporting 193

10.4 Poverty Lines Using $1/Day and $2/Day and Basic Needs Measures 198

11.1 Hypothetical Data on Consumption per Capita for 10 Individuals 209

11.2 Chronic, Persistent, and Transient Poverty, China, 1985–90 215

11.3 Cost of Poverty Elimination in China, 1985–90 216

11.4 Quintile Transition Matrix for Households, 1993–98 218

11.5 The Headcount Poverty Rate (P0), S&W and BPS Methods 219

11.6 Poverty Transition Matrix, December 1998–August 1999 221

11.7 Alternative Measures of Poverty in Indonesia 222

11.8 Poverty Rates Computed Using Different Food Shares and Prices,

February 1996 and February 1999 223

11.9 Poverty Rates Using Different Assumptions about Deflation,

1997 and 1998 225

11.10 Estimates of Poverty Rates in Indonesia, 1996–99 226 xiii

Contents

12.1 Transition Matrix for Poverty, Vietnam, 1993 and 1998 233

12.2 Changes in Poverty from Panel Surveys in Selected Countries 233

12.3 Poverty and Vulnerability in Indonesia, 1998–99 240

12.4 A Framework for Analyzing Vulnerability to Poverty 244

12.5 Mechanisms for Managing Risk 245

13.1 Millennium Development Goals, Indicators, and Targets 252

14.1 Logistic Model of Rural-Urban Migration, Vietnam, 1993 289

15.1 Progressivity Illustrated 296

15.2 Incidence Assumptions for Study of Tax Incidence in Lebanon, 2004 301

15.3 Incidence of Value Added Tax, Peru, 2000 303

15.4 State Spending on Education, Peru, 2000 307

15.5 Benefit Incidence of Public Spending on Education in Selected

African Countries 310

15.6 Government Transfers to Households, Vietnam, 1993 and 1998 311

15A.1 Government Unit Health Care Subsidies, Ghana, 1992 (million cedis) 316

15A.2 Health Service Visits, Percentage of Persons Reported Ill or Injured,

Ghana, 1992 316

15A.3 Incidence of Health Subsidies, Ghana, 1992 316

15A.4 Affordability Ratios for Publicly Provided Health Care, Ghana, 1992 317

16.1 Income, Poverty, and Inequality in Malawi, 1997/98 and 2004 321

16.2 Price Indexes for Inflating Poverty Lines in India 325

16.3 Headcount Poverty Rates for India, Official and Adjusted 325

16.4 Headcount Poverty Rates in Honduras, 1997, 1999, and 2003 329

16.5 Income, Headcount Poverty, and Inequality, Ethiopia, 1999–2000 329

16.6 Example of Correction for Nonresponse Bias 330

16.7 Percentage of Reported Spending Devoted to Health, Durable Goods,

and Rent, for Selected Eastern European and Former Soviet

Union Countries, 2002–03 332

16.8 Rates of Headcount Poverty and Inequality, with and without

Spending on Health, Durable Goods, and Rent, for Selected

Eastern European and Former Soviet Union Countries, 2002–03 332

16.9 Levels of Income, Inequality, and Poverty in Rural China, 1990 333

16.10 Household Size by Expenditure per Capita and Expenditure per

Household Deciles, Benin, 2003 335

A1.1 Data Description 340

A2.1 Stata Operators 351

A3.1 Bangladesh Nutritional Basket 377

xiv

xv

Preface

The Handbook on Poverty and Inequality provides tools to measure, describe,

monitor, evaluate, and analyze poverty. It provides background materials for

designing poverty reduction strategies. This book is intended for researchers and

policy analysts involved in poverty research and policy making. The Handbook

began as a series of notes to support training courses on poverty analysis and

gradually grew into a 16-chapter book. Now the Handbook consists of explanatory

text with numerous examples, interspersed with multiple-choice questions (to

ensure active learning) and combined with extensive practical exercises using

Stata statistical software.

The Handbook has been thoroughly tested. The World Bank Institute has used

most of the chapters in training workshops in countries throughout the world, includ-

ing Afghanistan, Bangladesh, Botswana, Cambodia, India, Indonesia, Kenya, the

Lao People’s Democratic Republic, Malawi, Pakistan, the Philippines, Tanzania, and

Thailand, as well as in distance courses with substantial numbers of participants

from numerous countries in Asia (in 2002) and Africa (in 2003), and online asyn-

chronous courses with more than 200 participants worldwide (in 2007 and 2008).

The feedback from these courses has been very useful in helping us create a hand-

book that balances rigor with accessibility and practicality. The Handbook has also

been used in university courses related to poverty.

The Handbook is designed to be accessible to people with a university-level

background in science or social sciences. It treats the material at a Master’s-degree

level, with an emphasis on intuitive explanations and practical examples. It also

provides the skills needed to be able to work on poverty analysis straightaway, and

gives a solid foundation for those headed toward a research career in the subject.

With sufficient self-discipline, it is possible to master the material in the Hand-

book without a formal course, by working through all the Stata-based exercises in

detail and by taking advantage of the multiple-choice questions at the end of the

chapters. But in our experience, most people find it easier to commit themselves to

a structured training course—10 intensive days suffice—whether face-to-face or

Preface

online. Either route should prepare one well to undertake relatively sophisticated

poverty analyses.

In preparing the Handbook, we have drawn heavily on the extensive and excellent

work by Martin Ravallion of the World Bank’s Development Research Group; the

discussion in the World Bank’s World Development Report 2000/2001: Attacking

Poverty; as well as background papers or presentations by Kevin Carey, Shaohua

Chen, and Zeynep Orhun; and contributions from José Ramon (“Toots”) Albert,

Kathleen Beegle, Nidhiya Menon and Celia Reyes. Zeynep Orhun thoroughly

reviewed the first 10 chapters, and Peter Lanjouw gave us very useful comments.

Hussain Samad, Changqing Sun, and Ngo Viet Phuong contributed to the prepara-

tion of the Stata exercises, and Lassana Cissokho helped with the bibliographic work.

We would like to express our sincere gratitude to all for their contributions.

We are deeply indebted to Roumeen Islam for her encouragement and support

throughout the development of the book. We also thank Denise Bergeron, Stephen

McGroarty, and Dina Towbin for editorial assistance, and Dulce Afzal and Maxine

Pineda for support toward the production of the book.

Questions, comments, and suggestions related to the Handbook are most welcome,

because they allow us to improve the Handbook as we update and extend it; they

should be directed to Shahidur Khandker at [email protected]. Our goal is

to increase the capacity to undertake poverty analysis everywhere. We hope that the

Handbook represents a useful step in this direction.

Jonathan Haughton Shahidur R. Khandker

Suffolk University, Boston World Bank, Washington, DC

xvi

xvii

Foreword

Over one hundred years have passed since 1899, when Seebohm Rowntree under-

took his path-breaking study of poverty in his hometown of York, in the north of

England. A single paid enumerator, along with several volunteers, interviewed 11,560

households in the span of about six months, collecting information on housing con-

ditions, rent, and employment. Income was imputed from wage data obtained from

employers. Rowntree established a poverty line based on the cost of a basic diet that

would provide 3,478 Calories per day for men, to which he added an allowance for

clothing and fuel.

The data were compiled, by hand of course, into tables and graphs, and the result-

ing study, Poverty: A Study of Town Life, was published in 1901. The book has been

called the first quasi-scientific empirical study of the subject. Not only did it inspire

many subsequent studies, but it had an enormous influence on public policy, in large

part because it showed that much poverty was structural in the sense that even work-

ing people were unable to earn enough to meet their needs. This finding implied that

government might need to play a role in tackling poverty, which is what happened

in Britain with the introduction of the Old Age Pensions Act in 1908 and the

National Insurance Act in 1911. Both reforms were influenced by Rowntree’s work

and introduced by his friend, David Lloyd George.

Much has remained the same since Rowntree’s study. We still need to collect sur-

vey information to analyze poverty; those data must be compiled, analyzed, and pre-

sented as input into policy making; and we still wrestle with many of the same issues

Rowntree faced—how to define an appropriate poverty line, how to measure

income, and how to judge well-being.

Much has changed, too. The easy availability of computing power and statistical

software has made the job of the poverty analyst both easier and harder—easier

because much of the grunt work of data compilation and presentation can be han-

dled quickly, and harder because much more is now expected of the analyst. Putting

together a few tabulations is no longer sufficient; now the analyst must consider the

robustness and representativeness of the results, justify the decisions made about the

choice of welfare indicator and poverty line, know about the construction of price

Foreword

indexes, be able to handle panel data, have the competence to make and understand

international comparisons of poverty, and apply increasingly sophisticated statistical

techniques.

It is in meeting these expectations that you will find this book useful. It grew out

of lecture notes prepared to accompany courses on poverty analysis and it balances

a discussion of theory and principles with numerous examples and exercises. After

working through the Handbook you will be able to do solid work on poverty analy-

sis, and you will find that the specialized literature on the subject has become acces-

sible. You will become part of a growing cadre of analysts who bring rigor and good

sense to bear on one of humanity’s most persistent problems. Rowntree would

approve.

Martin Ravallion

Director

Development Research Group

World Bank

xviii

xix

Jonathan Haughton (PhD, Harvard University, 1983) is a professor of economics at

Suffolk University in Boston and senior economist at the Beacon Hill Institute for

Public Policy. A prize-winning teacher, he has authored more than 30 articles in

refereed journals, penned more than 20 book chapters, coedited three books on

Vietnam, and written at least 100 reports on policy issues. He has taught or con-

ducted research in more than two dozen countries on five continents. Recent proj-

ects include an impact evaluation of the Thailand Village Fund, a study of tax

incidence in Vietnam, and the use of a computable general equilibrium model to

assess the economic effects of a switch from taxing income to taxing consumption in

the United States.

Shahidur R. Khandker (PhD, McMaster University, Canada, 1983) is a lead econo-

mist in the Development Research Group of the World Bank. When this Handbook

was written, he was a lead economist at the World Bank Institute. He has authored

more than 30 articles in peer-reviewed journals, including the Journal of Political

Economy, The Review of Economic Studies, and the Journal of Development Econom-

ics; has published several books, including Fighting Poverty with Microcredit: Experi-

ence in Bangladesh, published by Oxford University Press; and has written several

book chapters and more than two dozen discussion papers at the World Bank on

poverty, rural finance and microfinance, agriculture, and infrastructure. He has

worked in close to 30 countries. His current research projects include seasonality in

income and poverty, and impact evaluation studies of rural energy and microfinance

in countries in Africa, Asia, and Latin America.

About the Authors

xxi

CSES Cambodian Socio-Economic Survey

FGT Foster-Greer-Thorbecke

GE generalized entropy

HBS household budget survey

ICP International Comparison Project

MDGs Millennium Development Goals

OECD Organisation for Economic Co-operation and Development

P0 headcount index of poverty

P1 poverty gap index

P2 poverty severity index

PPP purchasing power parity

PWT Penn World Tables

SESC Socio-Economic Survey of Cambodia

SST Sen-Shorrocks-Thon

SUSENAS National Socioeconomic Survey (Indonesia)

VHLSS06 Vietnam Household Living Standards Survey of 2006

VLSS93 Vietnam Living Standards Survey of 1993

All dollar amounts are U.S. dollars unless otherwise specified.

Abbreviations

handbook on poverty and inequality - isbn: 9780821376133

Documents