nep-hap New Economics Papers
on Economics of Happiness
Issue of 2021‒11‒08
two papers chosen by
Viviana Di Giovinazzo
Università degli Studi di Milano-Bicocca

  1. Bread and Social Justice: Measurement of Social Welfare and Inequality Using Anthropometrics By Mohammad Abu-Zaineh; Ramses H. Abul Naga
  2. Inferring Inequality: Testing for Median-Preserving Spreads in Ordinal Data By Ramses H. Abul Naga; Christopher Stapenhurstz; Gaston Yalonetzky

  1. By: Mohammad Abu-Zaineh (CNRS, EHESS, Centrale Marseille, AMSE, and IDEP, Aix-Marseille Univ, Marseille, France.); Ramses H. Abul Naga (Departamento de Teoría e Historia Económica, Universidad de Málaga; Business School, University of Aberdeen; and Pan African Scientific Research Council.)
    Abstract: We address the question of the measurement of health achievement and inequality in the context of variables exhibiting an inverted-U relation with health and well-being. The chosen approach is to measure separately achievement and inequality in the health increasing range of the variable, from a lower survival bound ?? to an optimum value ??, and in the health decreasing range from ?? to an upper survival bound ??. Because in the health decreasing range, the equally distributed equivalent value associated with a distribution is decreasing in progressive transfers, the paper introduces appropriate relative and absolute achievement and inequality indices to be used for variables exhibiting a negative association with well-being. We then discuss questions pertaining to consistent measurement across health attainments and shortfalls, as well as the ordering of distributions exhibiting an inverted-U relation with well-being. An illustration of the methodology is provided using a group of five Arab countries.
    Keywords: anthropometrics, health achievement and inequality, survival thresholds, Arab countries
    JEL: I14 I15 O5
    Date: 2021–10
  2. By: Ramses H. Abul Naga (Departamento de Teoría e Historia Económica, Universidad de Málaga; Business School, University of Aberdeen; and Pan African Scientific Research Council.); Christopher Stapenhurstz (University of Edinburgh); Gaston Yalonetzky (University of Leeds)
    Abstract: The median-preserving spread (MPS) ordering for ordinal variables (Allison and Foster, 2004) has become ubiquitous in the inequality literature. However, the literature lacks an explicit frequentist method for inferring whether an ordered multinomial distribution G is more unequal than F according to the MPS criterion. We devise formal statistical tests of the hypothesis that G is not an MPS of F. Rejection of this hypothesis enables the conclusion that G is robustly more unequal than F. Using Monte Carlo simulations and novel graphical techniques, we fi nd that the choice between Z and Likelihood Ratio test statistics does not have a large impact on the properties of the tests, but that the method of inference does: bootstrap inference has generally better size and power properties than asymptotic inference. We illustrate the usefulness of our tests with three applications: (i) happiness inequality in the United States, (ii) self-assessed health in Europe and (iii) sanitation ladders in Pakistan.
    Keywords: inequality measurement; hypothesis testing; median preserving spread; ordinal data
    Date: 2021–10

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