2015
DOI: 10.1007/s10888-015-9303-5
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When do relative prices matter for measuring income inequality? The case of food prices in Mozambique

Abstract: Changes in relative prices of commodities consumed in different shares across income groups can be expected to alter real income differentials between these groups. Using Mozambican household budget survey and price data from 2002/03 and 2008/09, we show that once relative price increases are accounted for, inequality of real consumption increases substantially. We obtain this result by constructing a price deflator that reflects divergent price dynamics of different product categories. Since the main factors … Show more

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Cited by 23 publications
(17 citation statements)
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“…In this chapter, I follow the method proposed by Arndt et al (2015). 1 Consumption items are divided into three groups: core food items, non-core food items, and non-food items.…”
Section: Appendix 9amentioning
confidence: 99%
“…In this chapter, I follow the method proposed by Arndt et al (2015). 1 Consumption items are divided into three groups: core food items, non-core food items, and non-food items.…”
Section: Appendix 9amentioning
confidence: 99%
“…Although the Cobb-Douglas functional form assume constant returns to scale, and the same returns to scale across districts, it is possible that returns to scale vary at different levels of inputs and across districts. In particular provincial administrations may influence returns to scale and economies of scale and in spite of national directives prices vary across districts (Arndt, Jones et al 2015). Differences in the incentives for staff, such as the implementation of pay for performance schemes, which began to be applied in some provinces only in 2012, may also affect productivity.…”
Section: Discussionmentioning
confidence: 99%
“…2 Arndt et al (2015) do not use a Paasche index. This study uses a true Paasche index as its properties are well known.…”
Section: Appendix 9amentioning
confidence: 99%