conditions, a unique solution for the subjective poverty line can then be obtained from the estimated parameters of the probit regressions for consumption adequacy.

Interestingly, the literature to date on estimating SSPL’s does not suggest that they differ greatly from prevailing poverty lines estimated by other means, including absolute lines in developing countries.<sup>38</sup> Indeed, the overall poverty rate (headcount index) based on the SSPL is roughly similar to that implied by pre-existing objective poverty lines.<sup>39</sup> It may well be that the choice of parameters in the “objective” absolute lines already approximated the expected SSPL in the specific context. But the structure of the poverty profile has turned out to be different in some respects; for example, while objective poverty lines often imply that larger households are poorer, this is not typically the case with the subjective approach (Pradhan and Ravallion, 2000).

Do subjective poverty lines more like absolute lines or relative lines in the income space? (They clearly aim to be absolute in the space of perceived welfare.) While there have been only a few empirical studies that can address this question, they have offered some support for the idea that social subjective poverty lines behave more like the weakly relative lines discussed in section 4. Poverty lines calibrated to subjective welfare data have tended to rise with meanincome but with elasticities less than unity. Hagenaars and van Praag (1985) estimated an elasticity of 0.51 for eight European countries. Some studies have also identified a weakly relativist gradient within a given country. For the US, Kilpatrick (1973) estimated an elasticity of about 0.6 for subjective poverty lines and De Vos and Garner (1991) found an own-income elasticity of the subjective poverty line in the US of 0.43.<sup>40</sup> For one of the poorest (and most unequal) developing countries, Malawi, Ravallion and Lokshin (2010) found evidence of relative deprivation effects in respondents’ “satisfaction with life” but only amongst relatively well-off people, notably in urban areas; this was not evident amongst the poor, for whom the positive external effects of having better off social comparators (friends and neighbors) dominated. Ravallion (2008b) calculates the implied (iso-welfare) poverty lines for Malawi, and shows that

> 38 The applications to date for developing countries include Pradhan and Ravallion (2000) using data for Jamaica and Nepal, Taddesse and Shimeles (2005) for Ethiopia, Gustafsson (2004) for urban China and Lokshin et al. (2006) for Madagascar.

> 39 An exception to this finding is reported for the US by de Vos and Garner (1991), where the SSPL is well above the prevailing (absolute) line, though (as already noted) the US line has not been updated in real terms since the 1960s; a more current absolute line for the US would probably be closer to the SSPL.

> 40 By contrast, Luttmer (2005) reports regressions for subjective welfare in the US that imply strong relativism. However, Ravallion (2008b) argues that the tests used (in common with other papers in the literature) are likely to over-estimate the income elasticity of the poverty line.

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