Improving Estimates of Inequality and Poverty From Urban China’s Household Income and Expenditure Survey

John Gibson, Jikun Huang and Scott Rozelle

Working Papers in Economics from University of Waikato

Abstract: In urban China the Household Income and Expenditure Survey requires respondents to keep a daily expenditure diary for a full 12-month period. This onerous reporting task makes it difficult to recruit households into the survey, compromising the representative nature of the sample. In this article we use data on the monthly expenditures of households from two urban areas of China to see if data collection short-cuts, such as extrapolating to annual totals from expenditure reports in only some months of the year, would harm the accuracy of annual expenditure, inequality and poverty estimates. Our results show that replacing 12-month diaries with simple extrapolations from either one, two, four or six months would cause a sharp increase in estimates of annual inequality and poverty. This finding also undermines international comparisons of inequality statistics because no country other than China uses such comprehensive 12-month expenditure records. But a corrected form of extrapolation, based on correlations between the same household’s expenditures in different months of the year, gives much smaller errors in estimates of inequality and poverty.

Keywords: income distribution; survey methods (search for similar items in EconPapers)
JEL-codes: D31 O15 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2002-01-30
New Economics Papers: this item is included in nep-dev
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Citations: View citations in EconPapers (2)

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https://repec.its.waikato.ac.nz/wai/econwp/0201.pdf (application/pdf)

Related works:
Journal Article: Improving Estimates of Inequality and Poverty from Urban China's Household Income and Expenditure Survey (2003)
Working Paper: IMPROVING ESTIMATES OF INEQUALITY AND POVERTY FROM URBAN CHINA'S HOUSEHOLD INCOME AND EXPENDITURE SURVEY (2001)
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Persistent link: https://EconPapers.repec.org/RePEc:wai:econwp:02/01

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