Welfare economics

The World Income Inequality Database (WIID) provides information on income inequalities at both cross-country and time series levels.

Poverty takes on multiple dimensions and in essence describes a state of deprivation that prevents an individual from attaining some minimum socially acceptable standard of living. This state of deprivation can therefore be measured in a number of ways and according to various approaches.

The most commonly used method of profiling poverty in a society involves firstly establishing the minimum amount of money required to meet the cost of an individuals (or households) basic needs, which would include a food and non-food component. This poverty line is then utilised in conjunction with specific measures of poverty to develop an appropriate description of indigence in the society. However, poverty lines are difficult to measure and the choice of line often imprecise. Furthermore, indices are often subjective and arbitrary in the choice of variables or weights used in their construction. Yet another way of comparing relative wellbeing of pre-defined groups is the poverty dominance approach. In this type of analysis, no poverty lines are used, but groups are measured against each other in terms of chosen indicators such as income levels or access to certain assets or services. Using income as an example, the dominance method graphically depicts the cumulative proportion of those with access to each and every income level, for each group being considered. If it is shown that one groups cumulative distribution combined in some instances with poverty always falls bove or below anothers, strong statements can be made about relative wellbeing. For example, in the case of income, it could then be stated that one group is better off than another for each and every income poverty line chosen.

This research was related to the Clinic Survey of 1997 and is also the Technical Report to Chapter 14 of the SA Health Review 1998.