Econometrica: May, 1991, Volume 59, Issue 3

Subgroup Consistent Poverty Indices

https://doi.org/0012-9682(199105)59:3<687:SCPI>2.0.CO;2-Y
p. 687-709

Anthony F. Shorrocks, James E. Foster

It seems desirable that the overall level of poverty should fall whenever poverty decreases within some subgroup of the population and is unchange outside that group. Yet this simple and attractive property, which we call "subgroup consistency," is violated by many of the poverty indices suggested in recent years. This paper characterizes the class of subgroup consistent poverty indices, and identifies the special features associated with this property.