CHAPTER 11: The Analysis of Poverty over Time
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Other Issues in Panel and Repeated Cross-Sectional Data A number of other issues need to be borne in mind when comparing poverty rates over time, with or even without panel data. Comparability in questionnaire. When the goal is to measure change over time, it is important to ensure that the questions are the same, and that the length of the recall period is also the same. This does leave an awkward problem: What is the researcher to do if the question asked in the first round was a bad one? The question could be improved, but only at the cost of less comparability over time. Timing of fieldwork. Ideally, one would interview any given household at the same time of the year. This is because some variables, such as school enrollments, or farm cash income, vary seasonally. A farmer interviewed in August may remember the value of the recent harvest quite clearly; interviewed in March, the memory may have faded. Defining the household. Consider figure 11.1. At the time of the first survey, a couple is living together with a child. Five years later, when the survey is repeated, the husband has divorced and remarried, and they have a new child; the former wife is now living alone with the original child. Which of the two new households is the true heir to the original one? There is no single correct answer to this, but it does introduce a significant element of judgment into the construction of panels that are based on households. To ensure consistency, a clear protocol for dealing with such cases needs to be articulated before undertaking the second and subsequent rounds of a panel survey. Deflating. Over time, prices change. This means that monetary measures, such as income or expenditure, have to be deflated to make comparisons over time. This can be difficult, especially when prices change rapidly, as is likely in a crisis. The fundamental conclusions about what happened to poverty in Indonesia over 1997–99 hinge on which price deflator it is appropriate to use; this issue is discussed in more detail in the final section of this chapter. Figure 11.1 Defining the Household
Source: Authors’ creation.
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