# **1. Introduction**

Household consumption is typically the core concept at the center of any attempt to measure living standards, inequality and poverty in the developing world.<sup>1</sup> Measures of consumption are derived almost exclusively through survey, however a review of survey practice will quickly reveal extensive variation over several dimensions, such as the method of data capture (diary versus recall), the level of respondent (individual versus household), the reference period for which consumption is reported (anywhere from 3 days to one year) and the degree of commodity detail (from less than 20 items to over 400 items). Variations occur both across countries and over time as statistical offices alter survey designs, with little understanding of the implications of such changes for accurate and consistent measurement of consumption. Such variation hampers both crosscountry studies of poverty and inequality measures as well as the measurement of welfare trends within a country (Lanjouw and Lanjouw, 2001).<sup>2</sup> For example, the national living standards survey in South Africa found a decline in real food expenditure from 2000 to 2005 even though the same data sources indicated increases in overall consumption and declines in self-reported hunger/food insecurity. This contradictory finding is largely attributed to a change in survey design from recall to diary for food consumption measurement in 2005 (Yu, 2008).

Changes in survey design, if they matter, need to be considered in analysis of trends in consumption or poverty over time. By extension, analysis that pools surveys of different types to study economic growth and inequality should take these differences seriously. Consider, for example, the widely used UNU/WIDER World Income Inequality Database (WIID) on income distribution and inequality. Concerns about consistency in such cross-country databases focus on whether the source surveys are income or consumption surveys (such as Atkinson and Brandolini, 2001, and Pinkovskiy and Sala-i-Martin, 2009), and the comprehensiveness of the consumption measure (Chen and Ravallion, 2008), but not on the implications of variation in consumption survey design. Although we do not attempt a complete inventory of the consumption surveys in this database, for the data of six African countries (chosen on the basis of our past experience or access to survey materials: Côte d`Ivoire, Ghana, Malawi, South Africa, Tanzania, and Zambia)

> 1 Conceptual and practical reasons favoring consumption expenditures over income as a welfare measure are discussed in Deaton (1997). Empirically, statistics offices in a majority of the developing countries, with metadata in the United Nations Handbook of Poverty Statistics (UN 2005), use either consumption expenditures solely or in combination with income as their welfare measure. The only region with a high reliance on income surveys is Latin America, although even there increased use is made of expenditure surveys for poverty measurement.

> 2 In addition, the large and growing gaps between micro and aggregate estimates of household consumption hinder assessments of global progress in poverty reduction and the effect of economic growth on that process (Ravallion, 2003; Deaton, 2005). The extent to which possible measurement flaws in survey design format may contribute to this gap is unknown.

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