Re: st: Re: Factor analysis and dummy variables.

[Dale Larson <DWL@larsonglobal.com>]

Friedrich,

Is not "human capital" an asset?  And is not education an indicator of the 
size of that asset?

Whether human capital should be included in a wealth index depends on the 
particular definition of wealth that is of interest.

Dale Larson

At 11:30 PM 12/10/2004, you wrote:

> Amadou,
>
> Education of the household head is not an asset and should not be
> included in the PCA. Please have a look at the literature to get a
> better understanding of the theory behind the wealth index.
>
> Friedrich Huebler
>
> --- adiallo5@worldbank.org wrote:
> > I am using DHS and I include all this variables (building, toilet,
> > water,...) along with pure assets variables.
> > But I end up with the same problem: a very bad distribution.
> >
> > I intend to put education of heads along with other alike variables
> > to see if I get better results.

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