st: Re: simulating poverty by changing mean income

["R.E. De Hoyos" <redeho@hotmail.com>]

Brian,

If I am following correctly, you want to compute the change in poverty 
following a distribution-constant change in average income. Any inequality 
measure satisfying general desired properties (for example the GE family), 
will be scale invariant. Therefore an increase of, say, 10% in all household 
incomes will increase mean incomes in the same proportion without affecting 
inequality and surely changing your FGT measures.

Using your household data, you can simulate a distribution-constant change 
in average income by adjusting all (or the population subgroup that you are 
interested on) household incomes accordingly and then compute your FGT 
measures.

I hope this helps,
Rafa
________________________
R.E. De Hoyos
Faculty of Economics
University of Cambridge
CB3 9DE, UK
www.econ.cam.ac.uk/phd/red29/

----- Original Message ----- 
From: "Brian Sartene" <brisartene@yahoo.com>
To: <statalist@hsphsun2.harvard.edu>
Sent: Saturday, September 03, 2005 4:44 PM
Subject: st: simulating poverty by changing mean income



> Dear all:
> I have lorenz parameters for an income measure for
> various groups in a household survey dataset and would
> like simulate poverty levels (FGT measures) by
> substituting various means for the actual mean.
> Does anyone know of a way to do this (that doesn't
> require starting at the very beginning, trying to
> derive a general quadratic equation for the lorenz, &
> then undertaking a lot of mathematical gymnastics)?
> I'd be grateful for any suggestions.
> Thanks very much.
> Brian
>
>
>
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