TY - JOUR
T1 - When do relative prices matter for measuring income inequality? The case of food prices in Mozambique
AU - Arndt, Channing
AU - Jones, Edward Samuel
AU - Salvucci, Vincenzo
PY - 2015/9/30
Y1 - 2015/9/30
N2 - Changes in relative prices of commodities consumed in different shares across income groups can be expected to alter real income differentials between these groups. Using Mozambican household budget survey and price data from 2002/03 and 2008/09, we show that once relative price increases are accounted for, inequality of real consumption increases substantially. We obtain this result by constructing a price deflator that reflects divergent price dynamics of different product categories. Since the main factors driving this result prevail in other developing countries, it is likely that inequality may be underestimated elsewhere.
AB - Changes in relative prices of commodities consumed in different shares across income groups can be expected to alter real income differentials between these groups. Using Mozambican household budget survey and price data from 2002/03 and 2008/09, we show that once relative price increases are accounted for, inequality of real consumption increases substantially. We obtain this result by constructing a price deflator that reflects divergent price dynamics of different product categories. Since the main factors driving this result prevail in other developing countries, it is likely that inequality may be underestimated elsewhere.
U2 - 10.1007/s10888-015-9303-5
DO - 10.1007/s10888-015-9303-5
M3 - Journal article
SN - 1569-1721
VL - 13
SP - 449
EP - 464
JO - The Journal of Economic Inequality
JF - The Journal of Economic Inequality
IS - 3
ER -
