price indexes inequality and the measurement of world poverty i discuss the measurement of world poverty and inequality with particular attention to the role of purchasing power parity ppp price indexes from the international comparison project global inequality increased with the latest revision of the icp and this reduced the global poverty line relative to the us dollar the recent large increase of nearly half a billion poor people came from an inappropriate updating of the global poverty line not from the icp revisions even so ppp comparisons between widely different countries rest on weak theoretical and empirical foundations i argue for wider use of self reports from international monitoring surveys and for a global poverty line that is truly denominated in us dollars

the effect of utility time varying pricing and load control strategies on residential summer peak electricity use a review abstract peak demand for electricity in north america is expected to grow challenging electrical utilities to supply this demand in a cost effective reliable manner therefore there is growing interest in strategies to reduce peak demand by eliminating electricity use or shifting it to non peak times this strategy is commonly called demand response in households common strategies are time varying pricing which charge more for energy use on peak or direct load control which allows utilities to curtail certain loads during high demand periods we reviewed recent north american studies of these strategies the data suggest that the most effective strategy is a critical peak price cpp program with enabling technology to automatically curtail loads on event days there is little evidence that this causes substantial hardship for occupants particularly if they have input into which loads are controlled and how and have an override option in such cases a peak load reduction of at least 30 is a reasonable expectation it might be possible to attain such load reductions without enabling technology by focusing on household types more likely to respond and providing them with excellent support a simple time of use tou program can only expect to realise on peak reductions of 5

commercial and industrial demand response under mandatory time of use electricity pricing this paper is the first to evaluate the impact of a large scale field deployment of mandatory time of use tou pricing on the energy use of commercial and industrial firms the regulation imposes higher prices during hours when electricity is generally more expensive to produce we exploit a natural experiment that arises from the rules governing the program to present evidence that tou pricing induced negligible change in overall usage peak usage and peak load as such economic efficiency was not increased bill levels and volatility exhibit minor shifts suggesting that concerns about increased expenditure and customer risk exposure have been overstated

a survey of load control programs for price and system stability load control and demand side load management programs have been implemented in a large number of competitive power markets these programs can provide enhanced system security and many benefits to participants this paper reviews and compares existing economically driven programs

measuring poverty using qualitative perceptions of consumption adequacy we show that subjective poverty lines can be derived using simple qualitative assessments of perceived consumption adequacy based on a household survey we implement the method using survey data for jamaica and nepal respondents were asked whether their consumptions of food housing and clothing were adequate for their family s needs the implied poverty lines are robust to alternative methods of dealing with other components of expenditure the aggregate poverty rates accord quite closely with those based on independent objective poverty lines however there are notable differences in the geographic and demographic poverty profiles

measuring global poverty why ppp methods matter abstract we present theory and evidence to suggest that in the context of analyzing global poverty the eks approach to estimating purchasing power parities yields more appropriate international comparison of real incomes than the geary khamis approach our analysis of the 1996 and 2005 international comparison project data confirms that the geary khamis approach substantially overstates the relative incomes of the world s poorest nations and this leads to misleading comparisons of poverty across regions and over time the eks index of real income is much closer to being a true index of economic welfare and is therefore preferred for assessment of global poverty

weakly relative poverty prevailing measures of relative poverty are unchanged when all incomes grow or contract by the same proportion this property stems from seemingly implausible assumptions about the disutility of relative deprivation and the cost of social inclusion the authors propose weakly relative lines that relax these assumptions on calibrating our measures to national poverty lines and survey data we find that half the population of the developing world in 2005 lived in poverty only half of whom were absolutely poor the total number of poor rose over 1981 to 2005 despite falling numbers of absolutely poor with sustained economic growth the incidence of relative poverty became less responsive to further growth the number of relatively poor rose just as the numbers of absolutely poor fell

a field study using an adaptive in house pricing model for commercial and industrial customers in korea abstract demand response programs provide customers with economic incentives for load reductions at times of high market prices and system reliability constraints one type of demand response programs price based program induces customers to respond to changes in product rates however some large scale customers find it difficult to change their electricity consumption patterns even with rate changes because their electricity demands are commercial and industrial this study proposes an adaptive in house pricing model for large scale customers particularly those with multiple business facilities for self regulating price based program the adaptive in house pricing model charges higher rates to customers with lower load factors by employing a peak to off peak usage ratio in order to reduce usage at times of high prices at each facility this study analyzes the daily electricity consumption patterns of large scale customers through a field trial of the proposed pricing model at a telecom company with 447 offices and worksites for one month the results show that the pricing model corresponds to average reductions of 3 54 28 69 during peak demand times for four different types of workplaces however reductions in electricity consumption during off peak periods did not show a significant difference the results of this study prove that this proposed pricing model can be successfully applied to large scale operations

measuring poverty in a growing world or measuring growth in a poor world the extent to which growth reduces global poverty has been disputed for 30 years although there are better data than ever before controversies are not resolved a major problem is that consumption measured from household surveys which is used to measure poverty grows less rapidly than consumption measured in national accounts in the world as a whole and in large countries particularly india china and the united states in consequence measured poverty has fallen less rapidly than appears warranted by measured growth in poor countries one plausible cause is that richer households are less likely to participate in surveys but growth in the national accounts is also upward biased and consumption in the national accounts contains large and rapidly growing items that are not consumed by the poor and not included in surveys so it is possible for consumption of the poor to grow less rapidly than national consumption without any increase in measured inequality current statistical procedures in poor

measuring the effect of risk attitude on marketing behavior despite extensive study researchers continue to search for consistent and reliable measures of risk preferences to explain market behavior we find that a measure combining experiments rooted in expected utility theory and measures derived from surveys explains spot and contractual sales but does not exhibit substantially greater explanatory power than its underlying components survey based measures are generally more significant indicators of marketing choices but experimental measures reveal how risk attitudes vary over a range of probable outcomes which is important in light of increased commodity price volatility given recently identified limitations on the applicability of expected utility theory we suggest that researchers include survey methods to obtain low cost supplemental measures

on testing the scale sensitivity of poverty measures past tests of the sensitivity of aggregate poverty measures to changes in equivalence scales can be very sensitive to the arbitrary choice of the pivotal reference demographics it is recommended that future tests should use demographics typical of people living near the poverty line as their reference

the response of industrial customers to electric rates based upon dynamic marginal costs recent advances in technology and in the theory of electric utility operations and planning have led to an in creased interest in rate and service options that are differen tiated over short time intervals the purpose of this paper is to describe the results from an analysis of a real time pricing experiment recently conducted at niagara mohawk power corporation the objective of the experiment is to measure the response of large industrial customers to dynamic fully time differentiated marginal cost based electricity rates over a broad range of industries because of its design features including the establishment of an experimental control group the niagara mohawk study provides a rare opportunity to study large user response to real time pricing including inter hour price elasticities

the developing world s bulging but vulnerable middle class summary western notions of the middle class are of little obvious relevance to developing countries instead the middle class is identified here as those living above the median poverty line of developing countries even if still poor by rich country standards over 1990 2005 economic growth and global distributional shifts allowed an extra 1 2 billion people to join the developing world s middle class four fifths came from asia and half from china many of those in this new middle class remain fairly close to poverty only 100 million of the 1 2 billion would not be considered poor in any developing county economic growth typically came with an expanding middle class

on food security and the economic valuation of food the paper presents an economic evaluation of food and the cost of food insecurity building on behavioral regularities of consumer behavior the analysis estimates the benefit of food at the individual level and at the world level it finds an inverted u relationship between food benefit and income at the individual level the food benefit income ratio starts at 0 under extreme poverty increases with income to reach a maximum of 4 4 when income per capita is around 13 000 and then declines slowly as income rises the paper shows very large aggregate net benefit of food the analysis also evaluates the cost of food insecurity it shows that aversion to food insecurity is pervasive the coefficient of relative risk aversion to food insecurity being around 2 7 the analysis evaluates empirically the cost of food insecurity we report the cost of food insecurity under alternative scenarios documenting that it can be large in situations of exposure to significant downside risk

absolute poverty when necessity displaces desire abstract this paper proposes a new method for defining an international poverty line based on explicit budgeting the novel feature is that linear programming is used to deduce the diet that minimizes cost and guarantees survival nonfood items are also explicitly budgeted and amount to about one quarter of the cost of subsistence a series of least cost diets are calculated with increasingly demanding nutritional requirements for twenty countries using prices from icp 2011 the aim is to see which requirements rationalize the spending pattern of the poor the reduced basic model does the job when the cost of the nonfood items are added to the cost of the reduced basic diet the resulting linear programming poverty line lppl averages 1 88 per day across the poor countries in the sample the same model rationalizes both the spending pattern of the poor and the world bank poverty line the lppl has the advantages that it is 1 clearly related to survival and well being 2 comparable across time and space since the same nutritional requirements are used everywhere 3 adjusts consumption patterns to local prices 4 presents no index number problems since solutions are always in local prices and 5 requires only readily available information namely the prices in icp or equivalent

industrial response to electricity real time prices short run and long run i introduction with the emergence of competition in the electric industry wholesale prices are proving highly volatile during the summers of 1998 and 1999 prices in the midwest soared to 7000 or more per megawatt hour compared to a typical summer price of 30 50 one factor contributing to this volatility is that relatively few retail customers pay real time prices rtps that vary with changing supply and demand conditions as a result retail use is not deterred by the spikes in wholesale price exacerbating wholesale volatility without providing an opportunity for retail response there will be pressure on policy makers to curb wholesale volatility with such measures as the price caps approved by the federal energy regulatory commission in new york and california as a result of high electricity prices during 2000 increasingly electric utilities now offer their largest industrial and commercial customers hourly prices that vary with changes in real time supply and demand 1 the purpose of this article is to estimate and evaluate the short run and long run factors that influence customer price response to rtps to date there have been relatively few studies of response to rtp rates and those have been largely limited to short run estimates this study advances the research by evaluating how customer response to rtp changes with experience on the rates in addition there is consideration of the sensitivity of price response to changes in the levels of both prices and temperatures finally there is an examination of customer characteristics particularly on site generation that provide flexibility in responding to price changes the data include 110 industrial customers served by duke power a division of duke energy corporation some of the participating customers have been on rtp rates for as long as six years utilities need information on short run response to know the magnitude of demand relief that price responsiveness may provide when capacity is tight as well as to determine unit commitment and spinning reserve they need long run response to plan additions to capacity knowledge of individual customer response can help utilities target those customers who are most likely to opt for rtp responsive customers may include those with interruptible batch production processes and with on site generation in addition to utilities policy makers need to know price response to determine the role of rtp in achieving efficient electric resource use 2 this study adopts the modeling and estimation procedures set forth by herriges et al 1993 and king and shatrawka 1994 both employed a nested constant elasticity of substitution ces functional form herriges et al 1993 estimated response to an rtp rate offered by the niagara mohawk company at the time there were only 15 customers with usable data one strength of the study was the availability of a control group on non rtp rates king and shatrawka 1994 employed a much larger sample of 150 customers served by the midlands electric company great britain but did not have a control group both studies provided shortrun estimates only patrick and wolak 1997 also used midlands data to estimate demand elasticities from a generalized mcfadden functional form though their findings appear to be consistent with the other studies it is difficult to compare their results directly given the differing functional form 3 their study used several years of data and did include temperature but provided only short run estimates additionally there were no consistent findings regarding temperature their study proposed the analysis of customer learning for future work 4 o sheasy 1997 and gupta and danielson 1998 have raised the possibility that price response depends on the level of price o sheasy 1997 suggests a demand curve with vertical segments over certain price ranges

dollar a day revisited the article presents the first major update of the international 1 a day poverty line proposed in world development report 1990 poverty for measuring absolute poverty by the standards of the world s poorest countries in a new and more representative data set of national poverty lines a marked economic gradient emerges only when consumption per person is above about 2 00 a day at 2005 purchasing power parity below this the average poverty line is 1 25 which is proposed as the new international poverty line the article tests the robustness of this line to alternative estimation methods and explains how it differs from the old 1 a day line

how sensitive is regional poverty measurement in latin america to the value of the poverty line this paper contributes to the methodological literature on the estimation of international poverty lines for latin america based on the official poverty lines chosen by the latin american governments and commonly used in the public debate the paper exploits a comprehensive data set of 86 up to date official extreme and total urban poverty lines across 18 countries in latin america as well as the recently updated values of the national purchasing power parity conversion factors from the 2011 international comparison program and a set of harmonized household surveys by using 3 and 6 us dollars per person a day at 2011 ppp as the extreme and total poverty lines for latin america this paper illustrates the sensitiveness of poverty rates to changes of the values of the poverty lines as a result of the recent update of the ppp values the period of reference and the relative cost of living across the countries in the region the poverty lines with the 2011 ppp values lead to an increase in total poverty rates in latin america when compared to the 2005 ppp values while they leave the extreme poverty rate unaffected in general country specific poverty rankings remain fairly stable to the values of the poverty lines selected

what can new survey data tell us about recent changes in distribution and poverty it has been claimed that in recent times the poor have lost ground both relatively and absolutely even when average levels of living have risen this article tests that claim using household surveys for 67 developing and transitional economies over 1981 94 it finds that changes in inequality and polarization were uncorrelated with changes in average living standards distribution improved as often as it worsened in growing economies and negative growth was often more detrimental to distribution than positive growth overall there was a small decrease in absolute poverty although with diverse experiences across regions and countries almost always poverty fell with growth in average living standards and rose with contraction

global extreme poverty rates for children adults and the elderly chen and ravallion s estimates of global extreme poverty rates are well known this note by considering how these rates vary by age group reaches two important and policy relevant conclusions and emphasizes a central avenue for future research the first is that child extreme poverty rates are 50 higher than adult ones and almost twice those of the elderly this result depends on assuming that all individuals in a household have the same resource needs and no economies of scale exist as in the world bank standard approach conversely if conservative estimates of economies of scale and individual discount factors are adopted global extreme poverty rates and the child adult gap are much smaller than the chen and ravallion estimates these findings highlight the policy importance of research efforts towards understanding how needs vary within a household and with its size

global poverty estimates a sensitivity analysis summary current estimates of global poverty vary substantially across studies we undertake a sensitivity analysis to highlight the importance of methodological choices by measuring global poverty using different data sources parametric and nonparametric estimation methods and multiple poverty lines our results indicate that estimates of global poverty vary significantly when they are based alternately on data from household surveys versus national accounts but are relatively consistent across estimation methods the decline in poverty over the past decade is found to be robust across methodological choices