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Title:Two can live as cheaply as one... but three's a crowd PDF Logo
Authors:Bollinger, Christopher R.
Nicoletti, Cheti
Pudney, Stephen
Issue Date:2012
Series/Report no.:ISER Working Paper Series 2012-10
Abstract:To measure poverty, incomes must be equivalized across households with different structures. In this paper, we use a very flexible ordered response model to analyze the relationship be- tween income, demographic structure and subjective assessments of financial wellbeing drawn from the 1991-2008 British Household Panel Survey. Our results suggest the existence of large scale economies within marital/cohabiting couples, but substantial diseconomies from the addition of children or further adults. This pattern contrasts sharply with commonly-used equivalence scales, and is consistent with explanations in terms of the capital requirements associated with additions to the core couple.
Subjects:equivalence scales
subjective wellbeing
JEL:I32
J12
J13
Document Type:Working Paper
Appears in Collections:ISER Working Paper Series, Institute for Social and Economic Research (ISER), University of Essex

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