在贫困的发展中国家进行的主观福利分析的可靠性：2001年的马达加斯加

ROBUSTNESS OF SUBJECTIVE WELFARE ANALYSIS IN A POOR DEVELOPING COUNTRY: MADAGASCAR 2001 Michael Lokshin, Nithin Umapathi and Stefano Paternostro* ABSTRACT We analyze the subjective perceptions of poverty in Madagascar in 2001 and their relationship to objective poverty indicators. We base our analysis on survey responses to a series of subjective perception questions. We extend the existing empirical methodology for estimating subjective poverty lines on the basis of categorical consumption adequacy questions. Based on this methodology we calculate the household-specific, subjective poverty lines and compare the poverty profiles derived from different subjective welfare questions. Our results show that the aggregate poverty measures derived from consumption adequacy questions accord quite well with the poverty measures based on objective poverty lines. The subjective welfare analysis can be used in poor developing countries for evaluating socioeconomic and distributional impacts of various policy interventions Key words: Poverty, Subjective welfare, Africa, Madagascar World Bank Policy Research Working Paper 3191, January 2004 The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the view of the World Bank, its Executive Directors, or the countries they represent. Policy Research Working Papers are available online at http://econ.worldbank.org. * Corresponding authors: Nithin Umapathi, World Bank, 1818 H Street, NW, Washington, DC 20433, email numapathi@worldbank.org; Michael M. Lokshin, World Bank, email mlokshin@worldbank.org; Stefano Paternostro, World Bank, email: spaternostro@worldbank.org. We thank Martin Ravallion , Emanuella Gallaso, Jed Friedman for useful comments and suggestions, and Mattia Romani for constructive comments and help with the data.  1. Introduction Interest in the study of subjective perceptions of well being has grown during the last 30 years. The recognition of the complementarities between subjective and objective poverty analysis has led to increasing attempts to integrate the two approaches. Income-based objective welfare indicators often fail to account for important socio-economic factors that could affect the level of a household's well being. The effect of some of these factors could be difficult to measure, while others are inherently unobservable. For example, such characteristics as anticipation of future shocks, household's perception of income security, perception about changes in the household's needs over the lifecycle, and the relativity component of household welfare are reflected in the subjective measures of well being, but omitted from the objective measures. Subjective poverty analysis providing additional information on characteristics of the poor could help designing better-targeted poverty alleviation policy and can be effectively used for cross-validation of objective poverty profiles. Most of the empirical studies in this area, however, are based on data from developed countries and rely on Minimum Income Question (MIQ) methodology1. It is only recently that economists have turned their attention to analysis of subjective well being in developing countries and transition economies. Ravallion and Lokshin (2001, 2002) and Jovanovic and Milanovic (2000) deal with subjective welfare assessments in Russia. Pradhan and Ravallion (2000) assess subjective poverty in Jamaica and Nepal. These authors, as well as Deaton and Zaidi (2002), indicate that MIQ methodology might not be applicable to most developing countries, where income is not a well-defined concept, particularly in rural areas. To overcome this problem, Pradhan and Ravallion develop a qualitative model of perceived consumption needs that identifies the subjective poverty line without the MIQ. How robust are the results of subjective welfare analysis in poor developing countries? Which methods for analyzing subjective welfare are more informative in poor countries and how well do poverty profiles derived from the subjective approach 1 See, for example, studies by Easterlin (1974), Van Praag and Kapteyn (1973); more recent works by Hagenaars (1986), De Vos and Garner (1991), Di Tella et al. (2001), Frey and Stutzer (2002), Oswald (1997), and Van Praag and Frijters (1999); the Special Issue of Journal of Economic Behavior and Organization, Vol 51(1); and van Praag, Frijters, and Ferrer-i-Carbonell (2003) 2  correspond with those derived from the objective approach? In this paper we try to find the answers to these questions. Using data from the Madagascar Household Survey, we compare poverty profiles derived from different types of subjective welfare questions. We demonstrate that subjective welfare analysis based on consumption-adequacy questions produces sensible and robust results that correspond well with conventional, objective poverty analysis. At the same time, we find that MIQ-based poverty lines do not seem to generate sensible poverty profiles; they show only a weak correspondence to both objective and subjective poverty measures. To our knowledge, our paper presents the first comparative analysis of various methods of constructing subjective poverty lines in a poor developing country. Madagascar is the seventh poorest country in the world today (World Bank 2002), and as such it serves as a definitive test for our adaptation of subjective poverty analysis to poor countries. Almost 80 percent of the Malagasy population lives in rural areas. Agriculture, including fishing and forestry, is a mainstay of the economy, accounting for one-third of GDP and employing four-fifths of the population. During the second half of the last century Madagascar was plagued with natural disasters, crop failures, epidemics, and political and economic crises. Poorly conceived government policies contributed to a long-term economic decline. Between 1993 and 1997 per capita GDP fell by about 1 percent annually, leading to a poverty rate of almost 80 percent by 1997. Despite a subsequent decrease in the poverty rate to 69 percent, population growth increased the number of poor people in Madagascar by 1.8 million between 1993 and 1999. The total number of poor people in Madagascar now stands at about 10.5 million (World Bank 2002). The paper is organized as follows. The next section introduces data used in the analysis. Section 3 presents some descriptive statistics. Methodology and empirical specifications are discussed in Section 4. Section 5 presents our main results. Section 6 concludes. 3  2. Data and definitions The data for this study come from the 2001 Madagascar Household Survey (MHS). The MHS is a large-scale, multi-purpose survey of about 5,000 households that the Department for Household Statistics (DHS), National Statistical Institute, has conducted since 1993.2 The DHS collected the data for the latest MHS round in September, October, and November of 2001. They selected households for the survey sample through a multi- stage sampling technique. At the first stage, three strata were defined according to urban, rural, and semi-urban categories. Then 300 primary sampling units (PSUs) were selected from the strata with probability proportional to size. At the last stage, 16 to 18 households from each PSU were selected. The MHS instrument combines features of a regular household budget survey with the features of an integrated living standard measurement survey. It collects information on demographic characteristics of household members, their labor market activities, and their health and education status. A large section of the questionnaire gathers detailed information on income and consumption expenditures as well as on ownership of assets. In this paper we use total household consumption expenditure as a welfare indicator. Besides the traditional food and non-food components, the aggregate expenditure includes information on livestock, gifts, remittances, in-kind payments and in-kind consumption from non-farm activities. A measure of imputed rent is also included in the consumption aggregates for households that reported owning their houses. The consumption aggregates are deflated to account for regional price differences. The objective poverty line in Madagascar is based on the cost-of-basic-needs (CBN) method. The food poverty line is calculated as the cost of a food basket containing the minimum caloric intake of 2,133 calories per day. The composition of the food basket reflects the consumption patterns of the poorest three deciles of the population. To calculate the non-food component of the objective poverty line, the food poverty line is scaled up by the factor equal to the share of non-food consumption of households whose 2 Madagascar Household Survey rounds were conducted in 1993 (4,508 households), 1997 (6,350 households), 1999 (5,120 households) and 2001 (5,080 households). 4  total consumption is equal to the food poverty line (the so-called "lower poverty line", Ravallion 1998)3. No adjustments have been made to account for economies of scale arising from household size or for differences in nutritional requirements of the various age-gender groups. A special section of MHS includes questions about the subjective well being of each household.4 A block of these questions deals with the adequacy of consumption expenditure for major consumption groups. The questions are formulated as follows: Concerning your expenses relative to food, which of the following is true? a. Your expenses are below the household's needs b. Your expenses are on the average comparable to your household's needs c. Your expenses exceed your household's needs Similar questions are asked about expenses related to clothing, housing, and health. We call these the Consumption Adequacy Questions (CAQ). This paper is based on an analysis of answers to CAQs. 3. Descriptive analysis The distribution of answers to CAQs for food, housing, clothing and health care are shown in Table 1. About half of Madagascar households indicated that their expenditures on food, clothing, and housing are less than adequate to meet the households' needs. For all the consumption categories less than 3 percent of the households perceived their expenditures as more than adequate. Figure 1 shows how the subjective perceptions about the consumption adequacy depend on the level of household income. Approximately 60 percent of households from the lowest deciles of expenditure distribution consider their expenditure on food as inadequate. At the same time, that proportion is three times lower for the wealthiest households. A similar tendency could be observed for expenditures on clothing. Poor households are much more likely to categorize their expenditures on clothing as 3 For the detailed description of the methodology on constructing the welfare aggregate and objective poverty line in Madagascar, see Romani at el. (2003). 4 The questions in this module are asked at the household level. No information is available to identify the person who answers these questions. We assume that the household head replies to the questions concerning subjective well being of the household. 5  inadequate compared to better-off households. The proportion of households with perceived inadequate expenditures on clothing declines from 80 percent for the lowest expenditure deciles to less than 20 percent for the highest deciles. Trends in perceived adequacy of housing and health expenditures reveal lower income elasticities for these consumption groups. In particular, the share of households who thought that their housing expenditures were inadequate stays almost constant up to the 60th percentile of expenditure distribution. The perceptions of consumption adequacy vary geographically. Table 2 presents the average proportion of households with less than adequate expenditures across different regions of Madagascar. The highest proportion of dissatisfied households is found in Western Madagascar. Over 60 percent of households in Toamasina and Fianarantsoa considered their food consumption inadequate. On the other hand, only about 42 percent of families living in Toliara and Antananarivo perceived their food expenditures as inadequate. The rankings of expenditure adequacy for housing and clothing show similar patterns. Sixty-seven percent of households in Toamasina and 65 percent of households in Fianarantsoa thought that they did not spend enough on clothing. Households living in Toliara and Antananarivo regions seemed to be more satisfied with their clothing expenditure levels. Overall, households from the poorest regions of Madagascar were less satisfied with expenditure levels than households from the richer regions. Table 3 shows the proportion of households with inadequate consumption by type of household and consumption category. Again, general trends are clear