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Welfare rankings from multivariate data, a nonparametric approach

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  • Anderson, Gordon
  • Crawford, Ian
  • Leicester, Andrew

Abstract

Economic and social welfare is inherently multidimensional. However, choosing a measure which combines several indicators is difficult and may have unintendend and undesirable effects on the incentives of policy makers. We develop a nonparametric empirical method for deriving welfare rankings for a social planner based on data envelopment, which avoids the need to specify a weighting scheme. We apply this method to data on Human Development.

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  • Anderson, Gordon & Crawford, Ian & Leicester, Andrew, 2011. "Welfare rankings from multivariate data, a nonparametric approach," Journal of Public Economics, Elsevier, vol. 95(3), pages 247-252.
    • Handle: RePEc:eee:pubeco:v:95:y:2011:i:3:p:247-252
    DOI: 10.1016/j.jpubeco.2010.08.003
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    1. Gordon Anderson & Ian Crawford & Andrew Leicester, 2008. "Efficiency Analysis and the Lower Convex Hull Approach," Palgrave Macmillan Books, in: Nanak Kakwani & Jacques Silber (ed.), Quantitative Approaches to Multidimensional Poverty Measurement, chapter 10, pages 176-191, Palgrave Macmillan.
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    5. Xavier Ramos & Jacques Silber, 2005. "On The Application Of Efficiency Analysis To The Study Of The Dimensions Of Human Development," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 51(2), pages 285-309, June.
    6. Nanak Kakwani & Jacques Silber (ed.), 2008. "Quantitative Approaches to Multidimensional Poverty Measurement," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-58235-4, December.
    7. Maasoumi, Esfandiar, 1986. "The Measurement and Decomposition of Multi-dimensional Inequality," Econometrica, Econometric Society, vol. 54(4), pages 991-997, July.
    8. Serge-Christophe Kolm, 1977. "Multidimensional Egalitarianisms," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 91(1), pages 1-13.
    9. A. Atkinson, 2003. "Multidimensional Deprivation: Contrasting Social Welfare and Counting Approaches," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 1(1), pages 51-65, April.
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    Cited by:

    1. Mathieu Lefebvre & Sergio Perelman & Pierre Pestieau, 2015. "Productivity and performance in the public sector," Working Papers of BETA 2015-15, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    2. Athanassoglou, Stergios, 2013. "Robust Multidimensional Welfare Comparisons: One Vector of Weights, One Vote," Climate Change and Sustainable Development 150371, Fondazione Eni Enrico Mattei (FEEM).
    3. Stergios Athanassoglou, 2015. "Multidimensional welfare rankings under weight imprecision: a social choice perspective," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 44(4), pages 719-744, April.
    4. Vrachimis Konstantinos & Zachariadis Marios, 2013. "A contribution to the empirics of welfare growth," The B.E. Journal of Macroeconomics, De Gruyter, vol. 13(1), pages 213-244, April.
    5. Schröder, Carsten & Bönke, Timm, 2012. "Country inequality rankings and conversion schemes," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 6, pages 1-43.
    6. Athanassoglou, Stergios, 2015. "Revisiting Worst-case DEA for Composite Indicators," Climate Change and Sustainable Development 198712, Fondazione Eni Enrico Mattei (FEEM).
    7. Gordon Anderson & Teng Wah Leo, 2014. "Ranking Alternative Non-Combinable Prospects: A Stochastic Dominance Based Route to the Second Best Solution," Working Papers tecipa-520, University of Toronto, Department of Economics.
    8. Rogge, Nicky, 2018. "Composite indicators as generalized benefit-of-the-doubt weighted averages," European Journal of Operational Research, Elsevier, vol. 267(1), pages 381-392.
    9. Joanne Haddad & Jad Chaaban & Ali Chalak & Hala Ghattas, 2022. "Does Income Class Affect Life Satisfaction? New Evidence from Cross-Country Microdata," Social Sciences, MDPI, vol. 11(6), pages 1-23, June.
    10. Anderson, Gordon, 2011. "Polarization measurement and inference in many dimensions when subgroups can not be identified," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 5, pages 1-19.
    11. Meital Izraelov & Jacques Silber, 2019. "An assessment of the global food security index," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 11(5), pages 1135-1152, October.
    12. Gordon Anderson & Oliver Linton & Teng Leo, 2012. "A polarization-cohesion perspective on cross-country convergence," Journal of Economic Growth, Springer, vol. 17(1), pages 49-69, March.
    13. Stergios Athanassoglou, 2016. "Revisiting Worst-Case DEA for Composite Indicators," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 128(3), pages 1259-1272, September.
    14. Garcia-Diaz Rocio, 2013. "Poverty Orderings with Asymmetric Attributes," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 13(1), pages 347-361, June.
    15. Anderson, Gordon & Farcomeni, Alessio & Pittau, Maria Grazia & Zelli, Roberto, 2016. "A new approach to measuring and studying the characteristics of class membership: Examining poverty, inequality and polarization in urban China," Journal of Econometrics, Elsevier, vol. 191(2), pages 348-359.
    16. Argyris, Nikolaos & Østerdal, Lars Peter & Hussain, M. Azhar, 2023. "Value-driven Multidimensional Welfare Analysis: A Dominance Approach with Application to Comparisons of European Populations," Working Papers 12-2023, Copenhagen Business School, Department of Economics.
    17. Amado, Carla A.F. & São José, José M.S. & Santos, Sérgio P., 2016. "Measuring active ageing: A Data Envelopment Analysis approach," European Journal of Operational Research, Elsevier, vol. 255(1), pages 207-223.
    18. Athanassoglou, Stergios, 2013. "Multidimensional welfare rankings," MPRA Paper 51642, University Library of Munich, Germany.
    19. Briec, Walter & Dumas, Audrey & Stenger, Agathe, 2013. "On the standard achievement and well-being indexes and their relation to the Hicks–Moorsteen productivity index," Economic Modelling, Elsevier, vol. 35(C), pages 900-909.

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    More about this item

    Keywords

    Welfare; Nonparametric methods;

    JEL classification:

    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty

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