Re: st: how to deal with households

[Andrea Bennett <mac.stata@gmail.com>]

Thank you for the info! I once was told the same but thought there  
might be different voices or critical voices round when doing it the  
way you described!

Kind regards and many thanks,

Andrea


On Jun 20, 2008, at 12:27 PM, Philipp Rehm wrote:


> .
> One very common way to adjust for household size is to divide the  
> household income by the square root of the number of people living  
> in that household.
>
> This might be a helpful site:
> http://www.lisproject.org/keyfigures/methods.htm
>
> It says:
>
> Equivalence scale
> The equivalent income of an individual is defined as the household  
> income of the individual adjusted for differences in household size.  
> Unrelated individuals are considered to be 1-person families. Each  
> member of a given household has the same equivalent income,  
> regardless of age or family relationship.
> The square root of the number of persons in the household is used as  
> the equivalence scale in all of the figures we report (see reference  
> #1, page 21).
> #1. Atkinson, A. B., L. Rainwater, and T. M. Smeeding. 1995. Income  
> Distribution in OECD Countries: Evidence from the Luxembourg Income  
> Study (LIS). Paris: OECD.
>
> HTH,
> Philipp
>
> Andrea Bennett wrote:
>
> > Hi,
> > I wonder if there is a consensus on how one deals with survey data  
> > where one individual was asked - besides a lot of other things -  
> > about the household income and the number of individuals in that  
> > household (including roomers). Now I think I somehow got to adjust  
> > income as it obviously depends whether one can use 5000$ for one,  
> > two or three people. On the other side I wonder how individuals  
> > responded to the household income question when they were just  
> > sharing a flat with friends. But, there might be some consensus on  
> > that topic? So, is there a good way to adjust household income?
> > Many thanks for your consideration,
> > Andrea
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