An Intertemporal Comparison of Income and Welfare for Two Mexican Regions

Hector Villarreal

No 20062, Working Papers from Escuela de Graduados en Administración Pública y Políticas Públicas, Campus Monterrey

Abstract: This paper compares the evolution of income (GDP per capita) with utility derived welfare indices for two Mexican regions from 1992-2000. A methodology is proposed based on implicit true standard of living indices. Results show that welfare dynamics differed between regions and varied considerably compared to GDP per capita measures for the same period, thereby posing three questions: how well aggregate income measures reflect welfare, the role of CPI as a cost of living index, and the existence of different thresholds for wealth and welfare conditioned on development levels. This research reaffirms the importance of household preferences in evaluating welfare.

Keywords: Mexico; welfare; intertemporal comparison; income; CPI (search for similar items in EconPapers)
JEL-codes: I30 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2006-07, Revised 2006-07
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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