 Welfare comparisons within countries beyond GDP: An application to NigeriaDozie Okoye and Sujita Pandey Economic Modelling, 2024, vol. 140, issue C Abstract: This study implements a novel method to assess subnational welfare differences, addressing the limitations of traditional measures based solely on output or consumption, and ordinal measures such as HDI. We develop a unified and theoretically grounded welfare measure that incorporates consumption, leisure, inequality in consumption and leisure, and life expectancy. The resulting welfare measure is cardinal and interpretable as a consumption equivalent, offering an advantage over ordinal indices such as HDI. Applying this method to Nigeria, the analysis reveals that welfare is positively correlated with consumption and HDI because all incorporate aspects of consumption, inequality, and health. However, welfare differences are four times greater than those suggested by consumption alone, with significantly different rankings, underscoring the critical roles of health and inequality in welfare. Additionally, the innovative inclusion of leisure, measured as non-labor time, significantly changes welfare rankings compared to HDI or IHDI. Keywords: Welfare; Nigeria; Africa; GDP; Subnational welfare; Regional welfare (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:140:y:2024:i:c:s0264999324001883 DOI: 10.1016/j.econmod.2024.106831 Access Statistics for this article Economic Modelling is currently edited by S. Hall and P. Pauly More articles in Economic Modelling from Elsevier |
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