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Surveys: Using LSMS, HBS, LFS Surveys: Using LSMS, HBS, LFS and SILC for Poverty Analysisand SILC for Poverty Analysis

Rachel Smith-Govoni

April 4, 2008

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Goals and NeedsGoals and Needs

Goals:

• Measure the poverty impact of economic policy

• Measure the distributional impact of economic policy

Needs:

• Rely heavily on household survey data

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Household Surveys - typesHousehold Surveys - types

• Single Topic

• Labour Force Surveys( LFS) (ILO)

Census – national, 10 years – Serbia 2002

• In-between

• Multi-topic

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Household SurveysHousehold Surveys

• Single Topic

• In-between

• Agricultural Surveys (FAO)

• Demographic and Health (DHS)

• Household Budget Surveys (HBS)

• Multi-topic

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Household SurveysHousehold Surveys• Single Topic

• In-between

• Multi-topic• Multiple Indicator Cluster Survey

UNICEF

• Living Standards Measurement Study

• Survey on Income and Living Conditions (SILC, EU)

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CensusCensus

• Accurate measure of the population of a country

• Geographic distribution of the population

• Basic demographic information

Purpose

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CensusCensus

• Not a sample

• Universal coverage

• No sampling errors in estimates

• Some corrections for non-response may be needed

• Not many items

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CensusCensus

• Demographic information: age, sex, race/ethnicity, family and household composition

• Housing information

• Others: basic education, labour, disability

Content

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CensusCensus

Limited monitoring

•Albania: 2001 (1989)•BiH 1991 (1981)•Montenegro 2003 (1991)•Serbia 2002•Kosovo 1981

Limited use if looking at impact of policies affecting taxes, tariffs or pricing

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CensusCensus

• Sample frame

• Link with household surveys for small area estimation (data mapping)

Uses

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Two types of errors:Two types of errors:

Sampling and non-sampling

• Cost •Time

•Non-response• Training

DECRG: May 7 2004 Sample size

Sampling errorNon-sampling error

Sampling vs. non-sampling errorsSampling vs. non-sampling errors

Total error

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Labour Force Survey (Anketa Labour Force Survey (Anketa o radnoj snazi – ARS) o radnoj snazi – ARS)

• Direct measurement of unemployment

• General characteristics of the labour force

Purpose

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Labour Force SurveyLabour Force Survey

• Relatively large samples

Desire to disaggregate to different geographic areas

• Individuals of working age

Sample

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Labour Force SurveyLabour Force Survey

• Characteristics of the labour force

– Demographics

– Education

• Sectoral distribution of employment

• Degree of formality

• Seasonal

• Income

Content

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Labour Force SurveyLabour Force SurveyLimitations:

• LFS typically capture partial, not total, income, under-estimate welfare

• Measurement Error - Labour income measurement error at both ends of the distribution

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LFS in Latin AmericaLFS in Latin AmericaItem non-responseItem non-response

Salaried Self-employed

Employer

Mean non- response rate

3.9% 10.2% 12.0

Source: Feres, 1998

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Household Budget Survey Household Budget Survey (Anketa o potrosnji (Anketa o potrosnji domacinstava – APD, domacinstava – APD,

• Inputs to National Accounts on consumer expenditures

• Track changes in expenditures over time

• Weights for the Consumer Price Index

(Indeks Potrosackih Cijena)

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• Usually medium size sample

• High non-response rates

Sample

Non response rates (Non response rates (Eurostat Eurostat

Household Budget SurveysHousehold Budget Surveys, 2003), 2003)•Bulgaria: 39.7%•Estonia, 44%•Hungary, 58.8% before replacement•Romania, 21.6 %

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Household Budget SurveysHousehold Budget Surveys

• Total Income

• Total Consumption - diary

• Short Demographics

• Central Europe: agriculture

• Limited health and education

Content

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Household Budget SurveysHousehold Budget Surveys

• Consumption based welfare measure

• Purpose of an HBS survey is NOT to measure welfare but to precisely measure mean expenditures on specific goods and services

• These are conflicting goals

Poverty Measurement

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Household Budget SurveysHousehold Budget Surveys

• Shortest possible reference periods

• Minimize number of omitted expenditures

• Good for precise measurement of regional or national means

• Because of lumpy nature of purchases, not good for comparisons among households

Poverty Measurement

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Multi-topic Household SurveysMulti-topic Household Surveys

Those with a focus on measuring poverty

• Survey on Income and Living Conditions (SILC)

• Living Standards Measurement Study Surveys (LSMS)

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Multi-topic Household SurveysMulti-topic Household Surveys

• Analysis of welfare levels and distribution

• Study links between welfare levels and individual and household characteristics, economic, human and social capital

• Social exclusion

• Levels of access to, and use of, social services, government programs and spending

Purpose

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Multi-topic Household SurveysMulti-topic Household Surveys

• Small sample sizes

• Trade-off issue: Quality and cost considerations

• Limits ability to assess programs or policies that affect small groups or small areas (over-sample)

• Infrequent in many countries

Sample

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LSMS 2002, 2003, 2007LSMS 2002, 2003, 2007

Content1 household composition

2 housing

3 individual demographics

4 health

5 labour

6 work history

7 social programs

8 migration

9 values and opinions

10 consumption

11 agriculture

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Multi-topic Household SurveysMulti-topic Household Surveys

• Total consumption

– Longer reference periods

– Able to calculate use value of durables and housing

• Total income

– Suffers from standard measurement errors

Poverty Measurement

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Designs for surveys across time Designs for surveys across time

Repeated cross sectional surveys

(e.g. Household Budget Survey, Labour Force Survey)

• Common design for large government surveys

• New sample drawn for each survey

• Carry similar questions each year

• Used for trend analysis at aggregate level

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Designs for surveys across time Designs for surveys across time

Cohort Studies

• Sample often based on an age group

• Follow up same sample members at fairly long intervals

• Developmental data as well as social and economic data

• Data from parents, teachers associated with cohort member

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Designs for surveys across timeDesigns for surveys across time

e.g. Panel Study of Income Dynamics, USA – since 1968!

Living in BiH 2001-2004, LSMS Albania 2002-2004,

LSMS Serbia 2002-2003

• Draw a sample at one point in time and follow those sample members indefinitely (or as long as the funding continues)

• Collect individual level data in household context

• Repeated measures at fixed intervals (annual data collection)

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Advantages of Panel DataAdvantages of Panel Data• Comparison of same individual over time - outcomes

• Track of aspects of social change

• Facilitates study of change and causal inference

• Minimise the problem of inaccurate recall

• Compare a person’s expectations with real change

• Look at how changes in individuals’ behaviour affects their households

Identifies the co-variates of change and the relative risks of particular events for different types of people

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Changes in Employment Changes in Employment StatusStatus

A: CROSS-SECTIONAL INFORMATION

Unemployed

Employed

2001 2007

Net change - 0.1% unemployed

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Changes in Employment Changes in Employment StatusStatus

B: PANEL INFORMATION

Still Unemployed

Still Employed

Unemployed

Employed

2001 2007

Net change - 0.1% unemployed Actual change is 10.1

continuouslyemployed

86.7%

employed 2001but unemployed 2007

5%

continuouslyunemployed

3.2%

unemployed 2001 but employed 2007

5.1%

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Balkan ExamplesBalkan Examples

Albania - 15% of the unemployed in 2002 had made the transition to formal sector employment by 2004

BiH - About half who were poor in 2001 remained poor in 2004. Many individuals moved out of poverty.

(Cross section headcount 18% for both years)

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Employment and the labour market Unemployment duration and exit rates

Do the unemployed find stable employment?

The effect of non-standard employment on mental health

Temporary jobs: who gets them, what are they worth, and do they lead anywhere?

Family and Household Patterns of household formation and dissolution

Breaking up - finances and well-being following divorce or split

The effect of parents’ employment on children's educational attainment

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A SampleA Sample• Concept of ‘longitudinal household’

problematic for a panel - households change in composition over time or disappear altogether

• Individual level sample

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Following rulesFollowing rules• All members of households interviewed at

Wave One

• Children born to these original sample members

• Original members are followed as they move house, and any new individuals who join with them are eligible to be interviewed

• New sample members are followed if they split from the original member

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Questionnaire designQuestionnaire design

• Core content carried every wave

• Rotating core questions

• One-off variable components – lifetime job history

– marital and fertility history

• Variable questions to respond to new research and policy agendas

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Attrition in panel surveysAttrition in panel surveys• Inevitable to some extent but can be

minimised

• Multiple sources of attrition in a panel– refusal to take part

– respondents move and cannot be traced

– non-contacts

• Worry is potential bias if people who drop out differ significantly from those who stay in

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87.7 90.394.9 94.8 97.5 97.2 97

0

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60

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80

90

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Wave 1 Wave 2 Wave 3 Wave 4 Wave 5 Wave 6 Wave 7 Wave 8

UK Panel Wave 1 RespondentsUK Panel Wave 1 RespondentsWave-on wave re-interview ratesWave-on wave re-interview rates

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FieldworkFieldwork• respondent incentives as a ‘thank-you’

• extended fieldwork period for ‘tail-enders’

• refusal conversion programme

• tracking procedures during fieldwork

• panel maintenance between waves– Change of Address cards to update addresses

– mailing of Respondent Report

– details of contacts with respondents between waves

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The user databaseThe user database

• Longitudinal data is complex

• Provide users with database structure which enhances usability

• Consistent record structure over time

• Key variables for matching and linking data cross wave

• Consistent variable naming conventions

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ConclusionsConclusions• Longitudinal panel data allows us to answer

research questions that cannot be answered with with cross-sectional data

• Provides a different view of the world - see process through the life-course not just a static picture

• Is complex (but so is the real world) - so needs to be well designed and conducted with sufficient resources to be successful

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FinalFinal pointspoints

• Welfare: household surveys- always missing the homeless, street children, institutionalized population

• No one survey can meet all needs, review its purpose, coverage, content and quality before using

• Need a system of surveys that meets the needs of data users