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Revisiting poverty and welfare dominance

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  • Gian Maria Tomat

    (Bank of Italy)

Abstract

The paper reviews the theory of the measurement of poverty. The axiomatic theory is described and the axiomatic properties of poverty indexes are related to assumptions on the functional form of the poverty index function. The notion of poverty ordering is then introduced and followed by a review of the relations between the poverty orderings than can be defined from classes of poverty index functions with well-defined functional form properties and the notions of first order and second order stochastic dominance. The analysis applies the results used in the theory of economic inequality to study the relationship between welfare orderings and Lorenz dominance. The theory is used to analyze poverty patterns in Italy in 1997-2005.

Suggested Citation

  • Gian Maria Tomat, 2007. "Revisiting poverty and welfare dominance," Temi di discussione (Economic working papers) 651, Bank of Italy, Economic Research and International Relations Area.
    • Handle: RePEc:bdi:wptemi:td_651_07
    as

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    File URL: http://www.bancaditalia.it/pubblicazioni/temi-discussione/2007/2007-0651/en_tema_651.pdf
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    References listed on IDEAS

    as
    1. Timothy Smeeding & Gunther Schmaus & Brigitte Buhmann & Lee Rainwater, 1988. "Equivalence Scales, Well-Being, Inequality and Poverty: Sensitivity Estimates Across Ten Countries Using the LIS Database," LIS Working papers 17, LIS Cross-National Data Center in Luxembourg.
    2. repec:bla:econom:v:72:y:2005:i:3:p:497-514 is not listed on IDEAS
    3. Clark, Stephen & Hemming, Richard & Ulph, David, 1981. "On Indices for the Measurement of Poverty," Economic Journal, Royal Economic Society, vol. 91(362), pages 515-526, June.
    4. Brigitte Buhmann & Lee Rainwater & Guenther Schmaus & Timothy M. Smeeding, 1988. "Equivalence Scales, Well‐Being, Inequality, And Poverty: Sensitivity Estimates Across Ten Countries Using The Luxembourg Income Study (Lis) Database," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 34(2), pages 115-142, June.
    5. Atkinson, Anthony B., 1970. "On the measurement of inequality," Journal of Economic Theory, Elsevier, vol. 2(3), pages 244-263, September.
    6. Coulter, Fiona A E & Cowell, Frank A & Jenkins, Stephen P, 1992. "Equivalence Scale Relativities and the Extent of Inequality and Poverty," Economic Journal, Royal Economic Society, vol. 102(414), pages 1067-1082, September.
    7. repec:bla:revinw:v:34:y:1988:i:2:p:115-42 is not listed on IDEAS
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    Cited by:

    1. Kanayo Ogujiuba & Ntombifuthi Mngometulu, 2022. "Does Social Investment Influence Poverty and Economic Growth in South Africa: A Cointegration Analysis?," Economies, MDPI, vol. 10(9), pages 1-23, September.

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    More about this item

    Keywords

    economic inequality; poverty; poverty ordering; stochastic dominance;
    All these keywords.

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty

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