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Consumption inequality between farm and nonfarm households in Taiwan: a decomposition analysis of differences in distribution
Author(s) -
Chang HungHao
Publication year - 2012
Publication title -
agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.29
H-Index - 82
eISSN - 1574-0862
pISSN - 0169-5150
DOI - 10.1111/j.1574-0862.2012.00598.x
Subject(s) - nonfarm payrolls , consumption (sociology) , economics , inequality , quantile regression , distribution (mathematics) , household income , income distribution , demographic economics , agricultural economics , econometrics , agriculture , geography , mathematics , mathematical analysis , social science , archaeology , sociology
Consumption has been recognized as a more reliable indicator of household well‐being than income. Although a considerable body of literature has examined income inequality between farm and nonfarm households, little is known about inequality in consumption. This research aims to fill this knowledge gap by investigating consumption disparity between farm and nonfarm households. Using a nationally representative household survey from Taiwan, we apply an unconditional quantile regression‐based decomposition method to decompose the differences in the distribution of household expenditure between these farm and nonfarm households. The results indicate that differences in the observed characteristics between these two types of households explain most of the consumption inequality. Moreover, the difference in the education level of the farm operator, household income, and the degree of urbanization are particularly important.