IDEAS home Printed from https://ideas.repec.org/a/spr/soinre/v154y2021i1d10.1007_s11205-020-02561-y.html
   My bibliography  Save this article

Comparing Income Poverty with Multidimensional Well-being Based on the "Conversion Efficiency"

Author

Listed:
  • Yuxiang Xie

    (Shandong University of Finance and Economics)

  • E. Xie

    (Shandong University)

Abstract

Based on the literature regarding Sen’s capability approach, this work contributes to the empirical literature on multidimensional well-being by exploring whether a relationship exists between resources and how individuals convert their personal endowments. To control for conversion efficiency, differences in individual efficiency levels are estimated using the Stochastic Frontier Approach (SFA) in a production analysis, and efficiency scores are calculated at the individual level to capture the main factors leading to existing conversion inefficiency. Differences in individual living standards may also be caused by lower/higher efficiency in converting personal resources into income and well-being. Some determinants of efficiency levels for both poor and non-poor individuals are then investigated. Individual characteristics that can contribute to explaining the relationship between individuals’ resources and achieved functioning are further investigated, and an individual’s conversion efficiency is found to be positively affected by increased parental income, being married and living in an urban or eastern area. On the other hand, ageing and a larger household size decrease an individual’s conversion efficiency. Constraints in the conversion of given resource factors into achieved functioning can be caused by personal, environmental or social factors. These conversion factors determine why one individual achieves higher functioning output than someone else with the same input.

Suggested Citation

  • Yuxiang Xie & E. Xie, 2021. "Comparing Income Poverty with Multidimensional Well-being Based on the "Conversion Efficiency"," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 154(1), pages 61-77, February.
    • Handle: RePEc:spr:soinre:v:154:y:2021:i:1:d:10.1007_s11205-020-02561-y
    DOI: 10.1007/s11205-020-02561-y
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11205-020-02561-y
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s11205-020-02561-y?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Truett, Dale & Roberts, Blaine, 1973. "Classical Production Functions, Technical Optimality, and Scale Adjustments of the Firms," American Economic Review, American Economic Association, vol. 63(5), pages 975-982, December.
    2. Paul Anand & Graham Hunter & Ron Smith, 2005. "Capabilities and Well-Being: Evidence Based on the Sen–Nussbaum Approach to Welfare," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 74(1), pages 9-55, October.
    3. Afriat, Sidney N, 1972. "Efficiency Estimation of Production Function," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 13(3), pages 568-598, October.
    4. Andrea Brandolini & Silvia Magri & Timothy M. Smeeding, 2010. "Asset-based measurement of poverty," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 29(2), pages 267-284.
    5. Lars P. Feld & Gebhard Kirchgässner & Christoph A. Schaltegger, 2004. "Fiscal Federalism and Economic Performance: Evidence from Swiss Cantons," Marburg Working Papers on Economics 200420, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    6. Emily Oster, 2019. "Unobservable Selection and Coefficient Stability: Theory and Evidence," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 37(2), pages 187-204, April.
    7. Binder, Martin & Broekel, Tom, 2012. "The neglected dimension of well-being: Analyzing the development of “conversion efficiency” in Great Britain," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 41(1), pages 37-47.
    8. Luis Ayala & Antonio Jurado & Jesús Pérez‐Mayo, 2011. "Income Poverty And Multidimensional Deprivation: Lessons From Cross‐Regional Analysis," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 57(1), pages 40-60, March.
    9. Sergio Salas Landeau & Dante Contreras, 2003. "Chilean labor market efficiency: an earning frontier approach," Estudios de Economia, University of Chile, Department of Economics, vol. 30(1 Year 20), pages 87-102, June.
    10. Somnath Chattopadhyay, 2014. "Analysis Of Poverty And Efficiency: An Earnings Frontier Approach," Bulletin of Economic Research, Wiley Blackwell, vol. 66(2), pages 133-155, April.
    11. Battese, G E & Coelli, T J, 1995. "A Model for Technical Inefficiency Effects in a Stochastic Frontier Production Function for Panel Data," Empirical Economics, Springer, vol. 20(2), pages 325-332.
    12. Liliana E. Pezzin & Barbara Steinberg Schone, 1999. "Intergenerational Household Formation, Female Labor Supply and Informal Caregiving: A Bargaining Approach," Journal of Human Resources, University of Wisconsin Press, vol. 34(3), pages 475-503.
    13. Caroline Dewilde, 2004. "The Multidimensional Measurement of Poverty in Belgium and Britain: A Categorical Approach," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 68(3), pages 331-369, September.
    14. Orazio P. Attanasio & Miguel Székely, 1999. "An Asset-Based Approach to the Analysis of Poverty in Latin America," Research Department Publications 3075, Inter-American Development Bank, Research Department.
    15. Jensen, Uwe & Gartner, Hermann & Rässler, Susanne, 2006. "Measuring overeducation with earnings frontiers and multiply imputed censored income data," IAB-Discussion Paper 200611, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    16. 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.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Danyang Li & Daizo Kojima & Laping Wu & Mitsuyoshi Ando, 2024. "Impact of rural households' digital ability on their production efficiency in China," Agribusiness, John Wiley & Sons, Ltd., vol. 40(1), pages 139-160, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Somnath Chattopadhyay, 2014. "Analysis Of Poverty And Efficiency: An Earnings Frontier Approach," Bulletin of Economic Research, Wiley Blackwell, vol. 66(2), pages 133-155, April.
    2. Somnath Chattopadhyay, 2011. "Earnings efficiency and poverty dominance analysis: a spatial approach," Economics Bulletin, AccessEcon, vol. 31(3), pages 2298-2318.
    3. Rolf Aaberge & Andrea Brandolini, 2014. "Multidimensional poverty and inequality," Temi di discussione (Economic working papers) 976, Bank of Italy, Economic Research and International Relations Area.
    4. Stephen M. Miller & Terrence M. Clauretie & Thomas M. Springer, 2006. "Economies Of Scale And Cost Efficiencies: A Panel‐Data Stochastic‐Frontier Analysis Of Real Estate Investment Trusts," Manchester School, University of Manchester, vol. 74(4), pages 483-499, July.
    5. Quitterie Roquebert & Jonathan Sicsic & Thomas Rapp, 2021. "Health measures and long-term care use in the European frail population," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 22(3), pages 405-423, April.
    6. Sickles, Robin C. & Song, Wonho & Zelenyuk, Valentin, 2018. "Econometric Analysis of Productivity: Theory and Implementation in R," Working Papers 18-008, Rice University, Department of Economics.
    7. Afrifa, Godfred Adjapong & Tingbani, Ishmael & Adesina, Oluseyi Oluseun, 2022. "Stochastic frontier modelling of working capital efficiency across Europe," Technological Forecasting and Social Change, Elsevier, vol. 184(C).
    8. Gabriela Pérez Quesada, 2017. "Technical efficiency of dairy farms in Uruguay: a stochastic production frontier analysis," Documentos de Trabajo (working papers) 0517, Department of Economics - dECON.
    9. Jürgen Volkert & Friedrich Schneider, 2011. "The Application of the Capability Approach to High-Income OECD Countries: A Preliminary Survey," CESifo Working Paper Series 3364, CESifo.
    10. Antonio Jurado & Jesus Perez-Mayo, 2012. "Construction and Evolution of a Multidimensional Well-Being Index for the Spanish Regions," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 107(2), pages 259-279, June.
    11. Edward Bernard Bastiaan de Rivera Rivera & Paulo Dutra Costantin, 2007. "Produtividade Total Dos Fatores Nas Principais Lavouras De Grãos Brasileiras: Análise De Fronteira Estocástica E Índice De Malmquist," Anais do XXXV Encontro Nacional de Economia [Proceedings of the 35th Brazilian Economics Meeting] 121, ANPEC - Associação Nacional dos Centros de Pós-Graduação em Economia [Brazilian Association of Graduate Programs in Economics].
    12. Voigt, Peter, 2004. "Russlands Weg vom Plan zum Markt: Sektorale Trends und regionale Spezifika. Eine Analyse der Produktivitäts- und Effizienzentwicklungen in der Transformationsphase," Studies on the Agricultural and Food Sector in Transition Economies, Leibniz Institute of Agricultural Development in Transition Economies (IAMO), volume 28, number 93021.
    13. Graham, Carol & Nikolova, Milena, 2015. "Bentham or Aristotle in the Development Process? An Empirical Investigation of Capabilities and Subjective Well-Being," World Development, Elsevier, vol. 68(C), pages 163-179.
    14. B.C. Okoye & A. Abass & B. Bachwenkizi & G. Asumugha & B. Alenkhe & R. Ranaivoson & R. Randrianarivelo & N. Rabemanantsoa & I. Ralimanana, 2016. "Differentials in technical efficiency among smallholder cassava farmers in Central Madagascar: A Cobb Douglas stochastic frontier production approach," Cogent Economics & Finance, Taylor & Francis Journals, vol. 4(1), pages 1143345-114, December.
    15. Zuniga-Gonzalez, C.A, 2009. "Analisis de la eficiencia tecnica de la unidad de VPN UNAN-LEON utilizando funcion de produccion stochastic frontier, 2007-2008 [Technical efficiency analysis of the PNV unit UNAN-Leon using produc," MPRA Paper 110950, University Library of Munich, Germany, revised 14 Jan 2009.
    16. Jianxu Liu & Sanzidur Rahman & Songsak Sriboonchitta & Aree Wiboonpongse, 2017. "Enhancing Productivity and Resource Conservation by Eliminating Inefficiency of Thai Rice Farmers: A Zero Inefficiency Stochastic Frontier Approach," Sustainability, MDPI, vol. 9(5), pages 1-18, May.
    17. Yang Li & Shin-Yi Chen, 2010. "The Impact of FDI on the Productivity of Chinese Economic Regions," Asia-Pacific Journal of Accounting & Economics, Taylor & Francis Journals, vol. 17(3), pages 299-312.
    18. Blazek, David & Sickles, Robin C., 2010. "The impact of knowledge accumulation and geographical spillovers on productivity and efficiency: The case of U. S. shipbuilding during WWII," Economic Modelling, Elsevier, vol. 27(6), pages 1484-1497, November.
    19. Geranda Notten & Keetie Roelen, 2010. "Cross-national comparison of monetary and multidimensional child poverty in the European Union: puzzling with the few pieces that the EUSILC provides," Global Development Institute Working Paper Series 13510, GDI, The University of Manchester.
    20. Daniela Schettini & Carlos Roberto Azzoni & Antonio Páez, 2011. "Neighborhood and Efficiency in Manufacturing in Brazilian Regions: a Spatial Markov Chain Analysis," ERSA conference papers ersa10p1052, European Regional Science Association.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:soinre:v:154:y:2021:i:1:d:10.1007_s11205-020-02561-y. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.