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The Treatment of Housing in Official Low Income Statistics

Author

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  • Paul Johnson
  • Steven Webb

Abstract

Official low income statistics contain analyses based on income ‘before’ and ‘after’ housing costs. We argue that in measuring changes in the real level of income before housing costs over time an inappropriate price index is used. In particular the price index accords insufficient weight to the relatively rapid rise in housing costs which form a disproportionately large part of the expenditures of the poor. We propose an alternative income measure which largely overcomes the sources of bias and appears to us to be a more reasonable definition of income before housing costs. In the final section we evaluate the usefulness of before and after housing costs measures.

Suggested Citation

  • Paul Johnson & Steven Webb, 1992. "The Treatment of Housing in Official Low Income Statistics," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 155(2), pages 273-290, March.
    • Handle: RePEc:bla:jorssa:v:155:y:1992:i:2:p:273-290
    DOI: 10.2307/2982961
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    Citations

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    Cited by:

    1. Alissa Goodman & Steven Webb, 1994. "For richer, for poorer: the changing distribution of income in the United Kingdom, 1961-91," Fiscal Studies, Institute for Fiscal Studies, vol. 15(4), pages 29-62, November.
    2. Chen, Feifei & Qiu, Huanguang & Zhang, Jun, 2022. "Energy consumption and income of the poor in rural China: Inference for poverty measures," Energy Policy, Elsevier, vol. 163(C).
    3. Peter Saunders & Yuvisthi Naidoo & Melissa Wong, 2022. "Comparing the Monetary and Living Standards Approaches to Poverty Using the Australian Experience," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 162(3), pages 1365-1385, August.
    4. Jenkins, Stephen P., 2015. "The income distribution in the UK: a picture of advantage and disadvantage," LSE Research Online Documents on Economics 103980, London School of Economics and Political Science, LSE Library.
    5. Zantomio, Francesca & Sutherland, Holly & Mullan, Killian, 2009. "Accounting for housing in poverty analysis," ISER Working Paper Series 2009-33, Institute for Social and Economic Research.
    6. Alissa Goodman & Steven Webb, 1995. "The distribution of UK household expenditure, 1979-92," Fiscal Studies, Institute for Fiscal Studies, vol. 16(3), pages 55-80, August.

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