A Multidimensional Analysis of Adaptation in a Developing Country Context

Abigail Barr and David Clark

No 2007-19, CSAE Working Paper Series from Centre for the Study of African Economies, University of Oxford

Abstract: Econometric analyses of European datasets suggest that income aspirations increase with current income. This finding is consistent with the adaptation hypothesis - the notion that individual aspirations adjust to reflect personal circumstances and living conditions. We add to these existing studies in two ways: we investigate the relationship between aspirations and living conditions within a developing country rather than a developed country context, thereby extending the analysis to individuals with considerably poorer living conditions; and we expand the analysis to look not only at income but also at educational and health aspirations. Like earlier studies we find that income aspirations increase with both the individual’s own actual income and the incomes of those around them. We also find a positive relationship between actual and aspired to education. However, with respect to health, we find that people aspire to more rather than less health when surrounded by others who are ill.

Keywords: adaptation; aspirations; poverty; well-being; education; health (search for similar items in EconPapers)
JEL-codes: D60 I10 I20 I31 (search for similar items in EconPapers)
Date: 2007
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Citations: View citations in EconPapers (3)

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