Earnings efficiency and poverty dominance analysis: a spatial approach

Somnath Chattopadhyay

Economics Bulletin, 2011, vol. 31, issue 3, 2298-2318

Abstract: The paper estimates an earnings frontier by the method of Corrected Ordinary Least Squares (COLS) and categorizes households as efficient or inefficient based on some benchmark efficiency score and the estimated frontier. The spatial distribution of the poor and non poor households is then explored by construction of a poverty segregation curve across efficiency zones. Robust poverty comparisons across the efficient and inefficient groups reveal that poverty is in fact higher for the efficient group compared to the inefficient one. The paper thus indirectly supports the “poor but efficient hypothesis”.

Keywords: Earnings Frontier; Poverty; Stochastic Dominance; Treatment Effect. (search for similar items in EconPapers)
JEL-codes: C1 I3 (search for similar items in EconPapers)
Date: 2011-08-13
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Citations: View citations in EconPapers (1)

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