Poors Living Standards By Justina Banyt MOTIVATION BEHIND Poor - - PowerPoint PPT Presentation

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Mar 02, 2024 377 likes •448 views

Critical review of the paper by Christian Broda, Ephraim Leibtag, and David E. Weinstein The Role of Prices in Measuring the Poors Living Standards By Justina Banyt MOTIVATION BEHIND Poor people pay more than rich? > location (Chung

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Critical review of the paper by Christian Broda, Ephraim Leibtag, and David E. Weinstein

The Role of Prices in Measuring the Poor’s Living Standards

By Justina Banytė

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MOTIVATION BEHIND

Poor people pay more than rich? > location (Chung & Myers, 1999) > price discrimination (Myers et al., 2009) Poverty rates stayed the same Substitution effect (CPI – static)  Is it true?

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APPROACH

Database constructed on the purchases(Nielsen, 2005) Control variables identified Regressions run

Quantitative chosen > measuring elasticity > controlling for the location/store type

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RESULTS

Poor do pay less! Coefficient [0.0108; 0.0088]***

> experience of shopping matters > trade-off: leisure vs. bargains > cheaper labour force in poor regions

In poorer areas – lower prices Quality effect (1/3) vs. shopping (2/3)

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RESULTS REVISITED

Interesting topic Representative data set Novel approach Questionable approach

> Data manipulation? > OVB (education, tastes) > Low R2 (9.29 at the best case)

Definition of poverty itself

(two sided substitution)