Short-Lived Shocks with Long-Lived Impacts? Household Income Dynamics in a Transition Economy

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collection.link.5
https://openknowledge.worldbank.org/handle/10986/9
collection.name.5
Policy Research Working Papers
dc.contributor.author
Lokshin, Michael
dc.contributor.author
Ravallion, Martin
dc.date.accessioned
2015-01-20T17:03:26Z
dc.date.available
2015-01-20T17:03:26Z
dc.date.issued
2000-10
dc.date.lastModified
2021-04-23T14:04:01Z
dc.description.abstract
In theory, it is possible that the persistent poverty that has emerged in many transition economies, is attributable to underlying, non-convexities in the dynamics of household incomes - such that a vulnerable household will never recover from a sufficiently large, but short-lived shock to its income. This happens when there are multiple equilibria in household incomes, such that two households with the same characteristics, can have different incomes in the long run. To test the theory, the authors estimate a dynamic, panel data model of household incomes, with non-linear dynamics, and endogenous attrition. Their estimates, using data for Hungary in the 1990s, exhibit non-linearity in the income dynamics. The authors find no evidence of multiple equilibria. In general, households bounce back from transient shocks, although the process is not rapid.
en
dc.identifier.uri
http://hdl.handle.net/10986/21298
dc.language.iso
en_US
dc.publisher
World Bank, Washington, DC
dc.relation.ispartofseries
Policy Research Working Paper;No. 2459
dc.rights
CC BY 3.0 IGO
dc.rights.uri
http://creativecommons.org/licenses/by/3.0/igo
dc.subject
absolute poverty
dc.subject
adjustment process
dc.subject
Agriculture
dc.subject
autoregression
dc.subject
business cycle
dc.subject
capital accumulation
dc.subject
Cd
dc.subject
central planning
dc.subject
chronic poverty
dc.subject
cumulative distribution function
dc.subject
data model
dc.subject
data set
dc.subject
distribution function
dc.subject
distribution functions
dc.subject
dynamic panel
dc.subject
econometric issues
dc.subject
econometric model
dc.subject
econometric models
dc.subject
Econometrics
dc.subject
Economic Development
dc.subject
economic dynamics
dc.subject
Economic Growth
dc.subject
Economic Review
dc.subject
Economic Studies
dc.subject
Economic theory
dc.subject
Endogenous Variable
dc.subject
Endogenous variables
dc.subject
equations
dc.subject
equilibrium
dc.subject
equilibrium level
dc.subject
exogenous variables
dc.subject
explanatory variables
dc.subject
famine
dc.subject
functional forms
dc.subject
General Equilibrium Model
dc.subject
GNP
dc.subject
growth models
dc.subject
household composition
dc.subject
household income
dc.subject
household incomes
dc.subject
household members
dc.subject
household size
dc.subject
human capital
dc.subject
income components
dc.subject
income distribution
dc.subject
income equation
dc.subject
income increase
dc.subject
Income Inequality
dc.subject
income level
dc.subject
income shocks
dc.subject
Income Study
dc.subject
Inequality
dc.subject
insurance
dc.subject
Labor market
dc.subject
Labor Markets
dc.subject
labor productivity
dc.subject
LDCs
dc.subject
linear Model
dc.subject
linear relationship
dc.subject
liquidity
dc.subject
living standards
dc.subject
low incomes
dc.subject
macroeconomics
dc.subject
Maximum Likelihood method
dc.subject
median income
dc.subject
multiple equilibria
dc.subject
negative impact
dc.subject
negative shocks
dc.subject
normal distribution
dc.subject
optimization
dc.subject
POLICY RESEARCH
dc.subject
poor
dc.subject
poverty dynamics
dc.subject
poverty incidence
dc.subject
private transfers
dc.subject
random effects
dc.subject
rapid increase
dc.subject
real income
dc.subject
real wages
dc.subject
Relative poverty
dc.subject
serial correlation
dc.subject
serial dependence
dc.subject
Series Data
dc.subject
significant effect
dc.subject
Social Policies
dc.subject
Social Policy
dc.subject
social safety
dc.subject
social security
dc.subject
surplus labor
dc.subject
theoretical models
dc.subject
time series
dc.subject
transition economies
dc.subject
unemployment
dc.subject
urban areas
dc.subject
Economic shocks
dc.subject
Household income
dc.subject
Transition economies
dc.subject
Economic impact
dc.subject
Poverty incidence
dc.subject
Panel analysis
dc.subject
Nonlinear programming models
dc.subject
Endogenous variables
dc.subject
Multiplier (economics)
dc.title
Short-Lived Shocks with Long-Lived Impacts? Household Income Dynamics in a Transition Economy
en
okr.date.disclosure
2000-10-31
okr.doctype
Publications & Research
okr.globalpractice
Poverty
okr.googlescholar.linkpresent
yes
okr.identifier.doi
10.1596/1813-9450-2459
okr.identifier.report
WPS2459
okr.language.supported
en
okr.region.country
Hungary
okr.topic
Poverty Reduction
okr.topic
Macroeconomics and Economic Growth :: Economic Theory & Research
okr.topic
Environment :: Environmental Economics & Policies
okr.topic
Health, Nutrition and Population :: Health Economics & Finance
okr.topic
Poverty Reduction :: Inequality
okr.topic
Poverty Reduction :: Services & Transfers to Poor
okr.topic
Social Protections and Labor :: Labor Policies
okr.unit
Poverty and Human Resources, Development Research Group

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