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Earnings efficiency and poverty dominance analysis: a spatial approach

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  • Somnath Chattopadhyay

    (Indian Statistical Institute)

Abstract

The paper estimates an earnings frontier by the method of Corrected Ordinary Least Squares (COLS) and categorizes households as efficient or inefficient based on some benchmark efficiency score and the estimated frontier. The spatial distribution of the poor and non poor households is then explored by construction of a poverty segregation curve across efficiency zones. Robust poverty comparisons across the efficient and inefficient groups reveal that poverty is in fact higher for the efficient group compared to the inefficient one. The paper thus indirectly supports the “poor but efficient hypothesis”.

Suggested Citation

  • Somnath Chattopadhyay, 2011. "Earnings efficiency and poverty dominance analysis: a spatial approach," Economics Bulletin, AccessEcon, vol. 31(3), pages 2298-2318.
    • Handle: RePEc:ebl:ecbull:eb-11-00277
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    Cited by:

    1. Somnath Chattopadhyay & Amita Majumder & Hasanur Jaman, 2014. "Decomposition of inter-regional poverty gap in India: a spatial approach," Empirical Economics, Springer, vol. 46(1), pages 65-99, February.

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    More about this item

    Keywords

    Earnings Frontier; Poverty; Stochastic Dominance; Treatment Effect.;
    All these keywords.

    JEL classification:

    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General

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