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Conflicting Measures of Poverty and Inadequate Saving by the Poor – The Role of Status Driven Utility Function

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  • Marjit, Sugata
  • Roy, Ranjan

Abstract

In presence of inequality a status driven utility function reconciles the conflict between income based and nutrition based measures of poverty. Moreover, it can explain why the poor tend to save less, an established empirical fact in the developing countries. The result is independent of the assumption of imperfect capital market. The paper attempts to integrate various strands of literature on status effects.

Suggested Citation

  • Marjit, Sugata & Roy, Ranjan, 2010. "Conflicting Measures of Poverty and Inadequate Saving by the Poor – The Role of Status Driven Utility Function," MPRA Paper 27472, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:27472
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Inequality; Inter-temporal consumer choice; Utility; Poverty;
    All these keywords.

    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty

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