Conversion Efficiency as a Complementing Measure of Welfare in Capability Space

Binder, Martin and Broekel, Tom (2008): Conversion Efficiency as a Complementing Measure of Welfare in Capability Space. Unpublished.

Abstract

In the capability literature, studies on the empirical measurement in the functionings space are abundant and a few studies even measure capability to function. We suggest adopting a third measure of welfare relevant to economists, namely the "conversion efficiency" measuring the efficiency with which individuals convert their resources into achieved functioning. We use a nonparametric efficiency procedure and construct such a measure for a basket of basic functioning achievement, using data from the British Household Panel Survey (BHPS).

• Item Type: MPRA Paper
• Language: English
• Keywords: conversion efficiency, welfare measurement, robust nonparametric efficiency analysis, functioning production
• Subjects: I - Health, Education, and Welfare > I1 - Health > I12 - Health Production: Nutrition, Mortality, Morbidity, Suicide, Substance Abuse and Addiction, Disability, and Economic Behavior; I - Health, Education, and Welfare > I3 - Welfare and Poverty > I31 - General Welfare; Basic Needs; Living Standards; Quality of Life; Happiness; R - Urban, Rural, and Regional Economics > R1 - General Regional Economics > R15 - Econometric and Input-Output Models; Other Models; I - Health, Education, and Welfare > I3 - Welfare and Poverty > I32 - Measurement and Analysis of Poverty