Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/35268
Authors: 
Aaberge, Rolf
Langørgen, Audun
Mogstad, Magne
Østensen, Marit
Year of Publication: 
2008
Series/Report no.: 
IZA Discussion papers 3686
Abstract: 
Despite a broad consensus on the need to take into account the value of public services and geographical cost of living differences when measuring poverty, there is little reliable evidence on how these factors actually affect poverty estimates. Unlike the standard approach in studies of the distribution of public services, this paper employs a method for valuing sector-specific local public services that allows for differences between municipalities in unit costs for providing public services. Furthermore, recipient frequencies in various demographic groups are used as the basis for determining the allocation of the value of these services on citizens of the municipalities. Geographical differences in living costs are taken into account by using municipal housing price indices or by replacing the country-specific poverty line with municipal-specific poverty lines. Applying Norwegian register data for the period 1993-2001, we find that disregarding the value of local public services and geographical cost of living differences yields a misleading picture of poverty.
Subjects: 
Poverty
public services
in-kind transfers
geographical cost of living differences
housing price indices
municipal-specific poverty lines
JEL: 
D31
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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