TY - JOUR
T1 - Relative price shifts, economies of scale and poverty during economic transition
AU - Lanjouw, Jean O.
AU - Lanjouw, Peter
AU - Milanovic, Branko
AU - Paternostro, Stefano
PY - 2004
Y1 - 2004
N2 - Economic transition is associated with significant shifts in relative prices between private and public goods. If, as a result, public goods claim a larger share of total expenditures, economies of scale in consumption increase. We show how relative price changes might alter the welfare of different-sized households in the short run and over time. We illustrate, for a selection of transition economies, that conventional poverty profiles are quite sensitive to assumptions made about economies of scale in consumption. In particular, the common view that large households with many children are poor relative to small households (such as those comprising the elderly) is shown to be highly non-robust.
AB - Economic transition is associated with significant shifts in relative prices between private and public goods. If, as a result, public goods claim a larger share of total expenditures, economies of scale in consumption increase. We show how relative price changes might alter the welfare of different-sized households in the short run and over time. We illustrate, for a selection of transition economies, that conventional poverty profiles are quite sensitive to assumptions made about economies of scale in consumption. In particular, the common view that large households with many children are poor relative to small households (such as those comprising the elderly) is shown to be highly non-robust.
KW - Poverty
KW - Public goods
KW - Transition economies
UR - http://www.scopus.com/inward/record.url?scp=4444248737&partnerID=8YFLogxK
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U2 - 10.1111/j.0967-0750.2004.00191.x
DO - 10.1111/j.0967-0750.2004.00191.x
M3 - Article
AN - SCOPUS:4444248737
SN - 0967-0750
VL - 12
SP - 509
EP - 536
JO - Economics of Transition
JF - Economics of Transition
IS - 3
ER -