Angus Deaton (앵거스 디턴)
Development Economist (Poverty & Inequality)
1. Measure of Poverty (가계동향조사 분석 및 창시)
Non-traded goods in poor countries are cheaper (Hair-cut, Houses…)
So, the current measure Living Standard measures can be misleading.
Originally used a common set of price:
BUT each countries have different consumption baskets.
eg) USA – Cheese consumption is HIGH l China – Cheese consumption is LOW
He is the Designer of the Household Surveys
2. Permanent Income Hypothesis (PIH) (항상소득가설을 반박)
PIH is a theory of consumption behaviour used in Demand & Consumption Analysis in macroeconomics.
Deaton was testing PIH (Deaton’s Paradox)
- For US, GDP has been persistently growing
- BUT, Consumption Volatility was a lot lower
- PIH suggest that IF income process is persistent,
Consumption Volatility > Income Volatility
- BUT Not observed in data (Quantitatively Disproved)
- Consumption Exhibits some extra smoothness
3. Almost Ideal Demand System (AIDS) (준이상수요체계)
Try to Estimate how people respond to change in Prices