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Optimal Anti‐Poverty Programmes: Horizontal Equity and the Paradox of Targeting

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  • Udo Ebert

Abstract

The paper examines the problem of optimal targeting when households differ in needs. Additively decomposable poverty measures based on the households' deprivation are employed. Needs are modelled carefully: household size and needs are reflected by equivalence scales and weights. The paradox of targeting corresponds to a situation in which the benefits given to a household type could decrease if the type's needs measured by the respective scale value are increased. I find that poverty programmes are horizontally equitable if and only if the weight attached to each household type equals the respective equivalence scale value. The paradox cannot then occur, either.

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  • Udo Ebert, 2005. "Optimal Anti‐Poverty Programmes: Horizontal Equity and the Paradox of Targeting," Economica, London School of Economics and Political Science, vol. 72(287), pages 453-468, August.
    • Handle: RePEc:bla:econom:v:72:y:2005:i:287:p:453-468
    DOI: 10.1111/j.0013-0427.2005.00425.x
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    Cited by:

    1. K. Mosler & C. Scheicher, 2008. "Attenuation of relative poverty by taxes and subsidies," Metron - International Journal of Statistics, Dipartimento di Statistica, Probabilità e Statistiche Applicate - University of Rome, vol. 0(3), pages 265-283.
    2. Edna Schechtman & Shlomo Yitzhaki & Taina Pudalov, 2011. "Gini’s multiple regressions: two approaches and their interaction," Metron - International Journal of Statistics, Dipartimento di Statistica, Probabilità e Statistiche Applicate - University of Rome, vol. 0(1), pages 67-99.

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