Estimating equivalence scales and non-food needs in Egypt: Parametric and semiparametric regression modeling

PLoS One. 2021 Aug 20;16(8):e0256017. doi: 10.1371/journal.pone.0256017. eCollection 2021.

Abstract

This paper investigated the appropriate specifications of Engel curves for non-food expenditure categories and estimated the deprivation indices of non-food needs in rural areas using a semi parametric examination of the presence of saturation points. The study used the extended partial linear model (EPLM) and adopted two estimation methods-the double residual estimator and differencing estimator-to obtain flexible shapes across different expenditure categories and estimate equivalence scales. We drew on data of the Egyptian Household Income, Expenditure, and Consumption Survey (HIEC). Our paper provides empirical evidence that the rankings of most non-food expenditure categories is of rank three at most. Rural households showed high economies of scale in non-food consumption, with child's needs accounting for only 10% of adult's non-food needs. Based on semi-parametrically estimated consumption behavior, the tendency of non-food expenditure categories to saturate did not emerge. While based on parametrically estimated consumption behavior, rural areas exhibited higher deprivation indices in terms of health and education expenditure categories, which indicates the need to design specific programs economically targeting such vulnerable households.

Publication types

  • Research Support, Non-U.S. Gov't

MeSH terms

  • Consumer Behavior
  • Economics / statistics & numerical data
  • Economics / trends*
  • Egypt
  • Equipment and Supplies Utilization / statistics & numerical data
  • Equipment and Supplies Utilization / trends*
  • Family Characteristics
  • Health Expenditures / statistics & numerical data*
  • Health Expenditures / trends
  • Humans
  • Income / statistics & numerical data
  • Rural Population / statistics & numerical data
  • Socioeconomic Factors

Grants and funding

The Deanship of Scientific Research at King Saud University for its funding this research group (RG-1435-088).