Our Expertise
In this study we provide some preliminary evidence about the impact of the economic crisis on household living standards, measured by real consumption expenditures per capita, and the distribution of living standards across households, measured by indices of inequality. Our study has two distinguishing characteristics worth highlighting right from the start.
In this paper we use repeated cross-sectional data from Indonesia for the years 1986 to 1998 to examine two inter-related questions.
Calculations of the benefit incidence and targeting effectiveness of "safety net" programs have typically examined only the relationship between a household's current expenditures and program participation. However, in programs that respond to an economic shock or intend to mitigate household risk, it is not just the current level of expenditures that matters, but also changes in expenditures.
Vulnerability is an important aspect of households' experience of poverty. Many households, while not currently "in poverty", recognize that they are vulnerable to events that could easily push them into poverty-a bad harvest, a lost job, an unexpected expense, an illness, an economic downturn.
The economic crisis has caused a clear deterioration in the welfare of the people of Indonesia. While there are many dimensions to individual and family welfare, here we focus on only one: a consumption expenditures based measure of "poverty." Even within the measurement of poverty we address only two issues.
