Dear Statalisters
I am analysing the relationship between poverty, inequality, and growth using
multi-year survey data. I am wondering whether there are any existing Stata
routines that can help me. I have looked at -gidecomposition- and it is similar
but not quite. I need to calculate the growth/inequality combinations that
would result in a given reduction in poverty (where poverty is measured as % of
people below a fixed numerical poverty line) over 2 periods. So in order to
reach an exogenously specified reduction in poverty (e.g. that no more than 5%
of people should be below the poverty line in period 2, down from say 7% in
period 1), there could either be fast growth with the existing income
distribution; or no growth with a shift to a more egalitarian distribution; or
more likely some combination of the two. In a way a similar type of thing to -gidecomposition-,
but sort of starting at the other end.
I was thinking of doing this ‘manually’ by adjusting growth and distribution and
seeing what the poverty outcome is (even though the poverty outcome is actually
what I want to set exogenously). But this is easier on the growth part than on
the distribution part. I could easily impose different growth rates by
adjusting all incomes by different factors. I’m not sure how one could ‘impose’
a redistribution component. Also it seems to me that there should be a more
efficient/accurate way of doing this! (I don’t know anything about advanced programming
in Stata but am trying to learn!)
Thank you for any suggestions.
Best,
Lola
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