Exercise 10.2

Well-being, in a household, can be represented alternatively by:

  1. Total expenditure of household "EXP"

  2. Total expenditure per capita     "EXPCAP"

  3. Total expenditure per adult equivalent "EXPEQ".

Using the variable SIZE to set the size variable, compute the headcount and the average poverty gap indices when the poverty line equals 140 000 FCFA and when the variable of interest is alternatively EXPEQ, EXPCAP and EXP. Explain why the results differ.

Answer
STEP 1: Initialising  the sampling weight: EDIT|Set Sample Design

  • After choosing the appropriate variable(s), click on  the button OK.

STEP 2: Use the DAD Application: POVERTY|FGT INDEX

 

  • After choosing the appropriate variable(s) and parameters, click on the COMPUTE button.

 

RESULTS

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FGT (Poverty)

Session Date Tue Sep 14 13:34:05 EDT 2004
Execution Time 0.032 sec
FileName SENEGAL_95.daf
OBS 2447
Sampling Weight WEIGHT
Variable of interest EXPEQ
Size variable SIZE
Group variable No Selection
Group Number 1
Option Normalised = NO
Parameter α=0

Index

Estimated value

Standard deviation

Lower bound

Upper bound

Confidence Level in (%)

FGT

0.66774261

0.01576732

0.63683923

0.69864599

95.00000000

Poverty line

140000.00000000

0.00000000

140000.00000000

140000.00000000

95.00000000

EDE

0.00000000

0.00000000

0.00000000

0.00000000

95.00000000

 

 
  Headcount Poverty gap
EXPEQ 0.6677 0.2613
EXCAP 0.7056 0.2912
EXP 0.0009 0.0003