Family Expenditure Survey Research Articles

The Impact of Rice Tariffication Law on Rice Farmer Income and Occupational Choice: A Microsimulation Approach

Purpose: This study was conducted to provide an ex-ante analysis of the impact of the Rice Tariffication Law (RTL) on rice farmers' income and occupation preferences. The study aims to determine how much increased in terms of total income before and after the implementation of RTL. Moreover the research aims to determine if how many farmers will shift to any industry after the implementation of RTL. Methodology: Using microsimulation modeling and logistic regression a microdata from the 2018 Family Income and Expenditure Survey (FIES) were used to simulate changes in total income and household-level expenditures. Findings: It was found that households whose heads were involved in agricultural activities and had more years of education had the highest income in the 2018 FIES. In the microsimulation model, it was observed that the implementation of the Rice Tariffication Law resulted in a noteworthy 52% increase in the total income of rice farmers who were recipients of the law, while non-recipients experienced a negative 19% change in their income. Moreover, an estimated 3,000 non-rice farmers transitioned to rice farming as income increased in rice farming activities. Unique Contribution to Theory, Practice and Policy: This study recommends the effective allocation and implementation of the Rice Competitiveness Enhancement Fund (RCEF) to benefit rice farmer recipients and promote inclusive growth for our farmers. Government institutions should promote microfinancing and strengthen cooperative systems to aid in the allocation of cash disbursement. The establishment of community-based offices focusing on the RCEF program will ensure that the program is accessible to farmers. Additionally, RCEF credit assistance should be considered for future study to assess the government's efficiency in implementing the program and whether the allocated fund is sufficient for all rice farmers in the country.

Catastrophic Out-of-Pocket Expenditure on Health: Evidence from the Regions in the Philippines

This study estimates Filipino’s catastrophic and impoverishing out-of-pocket (OOP) healthcare expenditures on a regional perspective to measure the effectiveness and progress of Philippines’ healthcare financing system in ensuring population protection from excessive and unequal healthcare costs. Observations are drawn from the most recent household-based survey in the Philippines, 2018 and 2021 Family Income and Expenditure Survey, and grouped by four major regions: National Capital Region, the rest of Luzon, Visayas, and Mindanao region. From 2018 to 2021, results showed that the distribution of catastrophic OOP healthcare expenditures decreases while depth of these payments increases across the four major regions. The highest incidences of these catastrophic payments were found in the rest of Luzon and Visayas regions, while the highest intensities were found in Mindanao region. Despite medicines and pharmaceuticals products dominance on OOP healthcare expenditures, payment on inpatient medical services drives the catastrophic expenditures of households. Aside, deepening poverty caused by healthcare payments were more evident in households residing in Mindanao regions, thus exposing this Filipino families to financial risk and poverty threats. Logistic regression analysis showed that aging households head, employment, and socio-economic status are significant and common factors affecting the likelihood of incurring excessive health expenditures across the regions. The risk of catastrophic and impoverishing effects of healthcare expenditures persists in the country. Low levels of catastrophic OOP healthcare expenditures may indicate that disadvantaged households focused on spending on basic necessities and struggle to afford healthcare due to high costs amid COVID 19, leading to foregone treatment. Thus, continuous implementation of fair and innovative ways of financing the healthcare system to reduce the financial burden of OOP payments on Filipino households is recommended.

Why has inequality in the Philippines declined? A two-stage hierarchical inequality decomposition analysis by location and education

The Philippines has been successful in reducing inequality over the last two decades. This study conducts a two-stage hierarchical inequality decomposition analysis by location and education to explore the determinants of declining expenditure inequality using the Family Income and Expenditure Survey. In the period 1997-2006, falling inequality among urban households with tertiary education is the dominant determinant by explaining 74% of declining overall inequality. In the period 2006-2018, falling disparity between urban and rural areas is the main determinant by explaining 42% of declining overall inequality. Falling inequality among urban households with tertiary education contributed also, but its contribution is 25%. Though expenditure inequality has declined, its level is still very high. To further reduce expenditure inequality, it is imperative to reduce inequality among households with tertiary education. It is also important to reduce inequality between education groups, particularly between households with tertiary education and those with lower education.

Inequalities and impacts on poverty incidence of tobacco, alcohol, and health out-of-pocket expenditures in the Philippines, 2012–2018

The Philippines increased taxes for tobacco and alcohol products and expanded population coverage under the national social health insurance scheme from 2012 to 2018. This paper examines inequalities in tobacco, alcohol, and health out-of-pocket (OOP) expenditures in the Philippines using the Family Income and Expenditure Survey 2012, 2015, and 2018. Fewer households reported spending on tobacco and alcohol, and the amount decreased among poor households over time, resulting in a decrease in impoverishment. Tobacco and alcohol spending was regressive, with the magnitude of regressivity decreasing between 2015 and 2018. Health OOP expenditures decreased between 2015 and 2018, with the magnitude of progressivity unchanged across time. Early evidence from this study suggests that the Philippines may have made some gains in reducing the inequitable effects of tobacco and alcohol spending on poorer households because of these policy reforms. Further analyses may be conducted to confirm whether these changes are affected by universal health coverage (UHC) policy reforms.

Human capital and the intertemporal substitution for leisure: empirical evidence for Spain

In this paper we provide the first estimate of the intertemporal substitution for leisure in Spain, accounting for the impact of human capital accumulation. This would allow uncovering whether the intertemporal labour supply of Spanish workers is affected by human capital. Our empirical strategy consists of estimating the equation for the intertemporal substitution of leisure with and without accounting for human capital, what allows to detect hypothetical estimation biases associated to omitting the impact of human capital. To that end, we build a pseudo-panel data set combining the Spanish Family Expenditure Survey and the Labour Survey over the period 1987–1997. While the model that ignores human capital accumulation provides an estimate of the intertemporal elasticity of substitution for leisure about 0.25, comparable to previously available estimates for Spain and other economies, the model with human capital provides an estimate about 0.5, what confirms the existence of a bias in the former estimates. Finally, this bias is larger for the younger cohorts than for the older ones.

FAMILY SAVINGS OF THE WORKING POPULATION IN MINDANAO, PHILIPPINES

<p>The study was conducted to understand the saving behavior of the working population in Mindanao using the Family Income and Expenditure Survey (FIES) datasets covering the periods 2003 to 2015. The study determined the factors which influence the families to save using Tobit regression and compared the levels of family income, expenditures, and savings of the regions of Mindanao. The study revealed that the real value of family savings increases as the family head gets older, but it eventually declines as the head nears retirement age. Tobit estimates revealed that in Mindanao, the age of the family head, household tenure, wages from agricultural and non-agricultural activities, income from entrepreneurial activities and cash assistance from abroad positively influence families to save; while sex of the family head, educational attainment, and the number of young dependents negatively influence the families to save. Moreover, the family size, marital status and geospatial location of the family heads have shown both positive and negative influences on family savings for different years. Meanwhile, the ANOVA results revealed that in 2015 there were significant variations between and among the income, expenditure, and savings of families in all regions of Mindanao. However, the Tukey-Kramer HSD test revealed that family savings in some regions in Mindanao have statistically the same means such as the Zamboanga Peninsula and CARAGA, Northern Mindanao and Davao Region, and SOCCKSARGEN and ARMM, while other regions vary significantly from each other. Overall, the ANOVA results revealed that for 2015 the Davao Region has the highest mean family income and expenditure, while Northern Mindanao recorded the highest mean family savings. The ARMM region showed the least value of mean income, mean savings and mean expenditures of families among the regions of Mindanao.</p><p> </p><p><strong>JEL</strong>: C34, D14, D15, E21</p><p> </p><p><strong> Article visualizations:</strong></p><p><img src="/-counters-/edu_01/0571/a.php" alt="Hit counter" /></p>

Estimating food demand and the impact of market shocks on food expenditures: The case for the Philippines and missing price data

Abstract This study uses the Quadratic Almost Ideal Demand System to estimate food demand among Filipino households. Our study uses the recently released 2018 Family Income and Expenditure Survey and the Stone-Lewbel price index in the absence of price data on food groups. Results show that demand for rice with respect to prices and expenditures is relatively inelastic compared with that for other food groups. The income elasticity for rice is inelastic (0.26), slightly higher than the income elasticity for sugar. Demand for rice is generally less elastic for higher-income Filipinos and families residing in urban areas than for their counterparts. The findings reveal that, in the short term, a 15 per cent decrease in income or a 20 per cent increase in rice prices induces families to spend more of their income on rice at the expense of other cereals, meat, fish, and other food groups. Income and rice price shocks have differential impacts on low-income and high-income Filipino families. Policymakers may be able to moderate the food price impacts of market shocks through targeted interventions and programs that improve the accessibility to and availability of quality agri-fishery products.

A nonparametric approach to understanding poverty in the Philippines: Evidence from the Family Income and Expenditure Survey

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Capitals, occupational fields and consumption preferences: An analysis of the British family expenditure survey (2009–2016)

Relationships between occupational membership and personal consumption have long been an important area of social analysis. Occupational groups represent important contexts of consumption, where individuals’ advantages and resources are accumulated and often impose reproduction of field-specific practices and patterns of behaviour. Drawing on Bourdieu’s conceptualization of capitals and using the British family expenditure survey, we explore consumption of capital-signalling goods across particular occupational groups within the professional-managerial ‘class’, associated with different capital structures, and demonstrate distinct spending strategies geared to the pursuit of occupational advancement. We examine consumption behaviours for six managerial/professional groups – business professionals; technical professionals; educational professionals; higher, and lower, private sector management; and public sector management. We test whether distinct patterns of ‘capital-signalling’ consumption can be identified and find significant effects of capital composition on presentational, socialization-related and informational expenditure, consistent with our hypotheses. We argue that consumption is a part of the signalling strategy of career agents, and between-occupational contrasts in capital-signalling expenditures are important but overlooked measures of capitals in cultural class analysis. We conclude that granular analysis of consumption patterns is important for revealing differences in accumulation of non-economic capitals across occupational groups, with significant implications for understanding inequality and class divisions.

Catastrophic Expenditure for Health in the Philippines

Catastrophic Expenditure for Health in the Philippines

Structural shifts in food basket composition of rural and urban Philippines: Implications for the food supply system.

Empirical evidence on the responsiveness and sensitivities of food consumption to its drivers is vital for conducting economic studies. Despite recent attempts to provide such estimates, much empirical work remains to be done considering the prevailing shifts in consumption trends in the Philippines. Price and expenditure elasticities are estimated for seven food categories for rural and urban Filipino households, using Stone-Lewbel (SL) price indices and the quadratic almost-ideal demand system (QUAIDS) model. We used multiple years (2006, 2009, 2012, 2015, and 2018) of the Philippines Family Income and Expenditure Survey (FIES) to estimate the food demand system. The results show that rice is a normal good for most households, particularly for rural consumers. However, it is an inferior good for the top 30% of rural Filipinos and the top 40% of urban Filipinos. As income increases, such wealthy households tend to replace their rice-dominated diet with nutrient-dense food products. Female-headed households, younger households, and households with educated members consume significantly more animal proteins such as meat and dairy products.

Comment on “Big Data in Asian Central Banks”

Comment on “Big Data in Asian Central Banks”

Interpolating poverty statistics in the Philippines for non-FIES years using DFM

The establishment of the Sustainable Development Goals in 2015 entails generating relevant and timely statistics for monitoring and policymaking. The Philippine Statistics Authority (PSA) generates poverty statistics using the Family Income and Expenditure Survey (FIES). However, due to certain limitations, the FIES collection and calculation of official poverty statistics is done only every three years. In this regard, this paper presents a method of filling in the gaps by interpolating annual poverty statistics, particularly the poverty incidence, using macroeconomic indicators and demographic and employment information from the Labor Force Survey (LFS). These explanatory variables were related to the poverty incidence using the Dynamic Factor Model (DFM) in the state-space form to produce estimates for years when poverty statistics are not available. Relatively high forecast accuracy was observed for the predicted values of poverty incidence.

Editors' Note

This issue's symposium on future research directions in forensic economics originated with papers that were presented at the January 4, 2020, National Association of Forensic Economics (NAFE) session “NAFE: An Agenda for Future Research” at the Allied Social Science Associations annual meeting in San Diego, California. The impetus for the session was to honor Jack Ward, the first editor of the Journal of Forensic Economics (JFE) by having him provide insights on what research in forensic economics has contributed to the current knowledge of practitioners, as well as his thoughts on the future directions of forensic economics research. This symposium contains papers on the topic of future research directions in forensic economics that were prepared by the presenters at the San Diego meeting.Jack Ward's paper suggests that there have been advances over the last three decades in forensic economics that include the Markov analyses of worklife expectancy; Expectancy Data's Dollar Value of a Day and Full-time Earnings in the United States that have advanced the projection of replacement household services and lost earnings; research based on Bureau of Labor Statistics Family Expenditure Survey data that has added greater precision to measures of self-consumption of earnings; and papers that have helped clarify differences between measuring probable earnings and earning capacity. Ward's paper concludes with a list of topics for further research in the forensic economics literature that includes more work on the role of race and gender in determining earnings; modeling dynamic changes in industry specific employment and wage growth; and the incorporation of Bayesian methodologies in lost wage projections, including the assignment of meaningful probabilities to outcomes.The paper by Michael Brookshire and Frank Slesnick discusses what their 10 surveys of NAFE members have revealed about important research topics. They argue that their surveys suggest that NAFE members place high importance on research on worklife of the disabled, worklife of the self-employed, personal consumption, and household services. Brookshire and Slesnick also offer, based on their experience as practitioners and researchers, the following agenda: whole-time approach to damages estimation; forensic economics in the classroom; a paper summarizing what is known as a result of the papers published in the JFE state paper series; tailoring, i.e., accounting for qualitative factors and variables omitted from standard economic models; the market for forensic economists; the definition of earning capacity; and what is meant by reasonable economic probability.The paper by Steven Shapiro suggests that despite the large body of published research in forensic economics, there are still controversial topics that are lacking consensus. Shapiro suggests that the controversial areas that should be the focus of research include the choice of interest rates for discounting; interest rates, earnings growth and inflation; interest rates, growth in medical costs and inflation; how many years of earnings history is necessary to project base earnings and earnings history; alternative approaches to hedonic damages; and punitive damages. Shapiro expresses the hope that research on these topics will improve the reliability and validity of the work of forensic economists.

Joint estimation of intertemporal labor and consumption decisions: evidence from Spanish households headed by working men

The aim of this paper is testing the three first-order conditions of an intertemporal optimization model for a representative individual who chooses simultaneously for her level of consumption and leisure, assuming a separable utility function. We estimate these conditions jointly in a system of equations, using a Spanish pseudo-panel data set built by combining the Family Expenditure Survey and the Labor Survey over the period 1987–1997. Our results are in line with previous empirical evidence as regards the elasticity of intertemporal substitution for consumption, as our estimate for this elasticity is between 0.4 and 0.5. Further, we also obtain the first estimate for Spain of the intertemporal elasticity of leisure. This value is above 0.3, and is comparable to other estimates found for other economies.

Distributional effects of carbon pricing in Brazil under the Paris Agreement

This paper assesses the distributional effects of carbon pricing on Brazilian households. We apply a multi-regional Computable General Equilibrium (CGE) model with representation of multiple households according to a family expenditure survey. Important questions for policy makers in Brazil are addressed. What are the economic effects of introducing carbon pricing in Brazil? Is there a double dividend, with economic and environmental benefits, when carbon revenue is recycled through tax rebates? Could carbon revenue contribute to the financing of social spending and to income distribution improvements in Brazil? Results show that carbon pricing avoids further carbon intensive infrastructure lock-in by further promoting biomass in electricity generation and biofuels in the transportation sector. Lump-sum transfers from carbon revenue help boosting income of lower deciles up to +4.5%, while targeting transfers to most vulnerable groups leads to an income growth of +42.2% by 2030. Brazil has a large gap in terms of effective carbon pricing when compared to other countries that could be addressed in the context of the ongoing tax reform debate, with carbon revenue contributing to the financing of social spending. Our analysis examines different policy design options and contribute to the debate about fiscal reform and socioeconomic effects of carbon pricing in Brazil.

IDENTIFICATION AND ESTIMATION IN A CORRELATED RANDOM COEFFICIENTS TRANSFORMATION MODEL

This study examines identification and estimation in a correlated random coefficients (CRC) model with an unknown transformation of the dependent variable, namely $\lambda \left (Y^{*}\right)=B_{0}+X^{\prime }B$ , where the latent outcome $Y^{*}$ may be subject to a certain kind of censoring mechanism, $\lambda (\cdot)$ is an unknown, one-to-one monotone function, and the random coefficients $\left (B_{0},B\right)$ are allowed to be correlated with one or several components of X. Under a conditional median independence plus a conditional median zero restriction, the mean of B is shown to be identified up to scale. Moreover, we show the derivative of the median structural function (MSF) is point identified. This derivative of MSF resembles the marginal treatment effect introduced by Heckman and Vytlacil (2005, Econometrica 73, 669–738).It generalizes the usual average treatment effect in a linear CRC model and coincides with $E(B)$ when $\lambda $ is equal to the identity function; it is invariant to both location and scale normalization on the coefficients. We develop estimators for the identified parameters and derive asymptotic properties for the derivative of MSF. An empirical example using the U.K. Family Expenditure Survey is provided.

Rational Choices and Welfare Changes in Philippine Family Energy Demand: Evidence from Family Income and Expenditure Surveys

Examining rationality of expenditures and analyzing welfare changes are interrelated because welfare change analysis is predicated on “rational” (i.e., expenditure-minimizing) responses to price and income changes. This study examined Philippine family demands for (1) electricity, (2) gas and liquid fuels, (3) solid fuels, (4) food, and (5) “others”—based on the Family Income and Expenditure Survey in 2009, 2012, and 2015—and found them rational. Specifically, own-price elasticities are negative (i.e., downward-sloping demand curves). Cross-price elasticities between (1), (2), and (3) are positive (i.e., substitutes, because of similar end-uses). Cross-price elasticities of (1), (2), and (3) with (4) or (5) are mostly negative (i.e., generally complements, because (1), (2), and (3) are used with (4) or (5)). Finally, income elasticities are positive, except for (3), implying that it is consumed less as income rises which is reasonable because (3) comprises “fuelwood and charcoal” that are consumed less by higher income households. The above elasticities yield a Hicks-Slutsky substitution matrix that is symmetric and negative semi-definite—the necessary and sufficient conditions for expenditure minimization—a finding probably unprecedented in a Philippine demand study. Therefore, the above results validate computing compensating variation (CV) and equivalent variation (EV) which are changes in compensated incomes (i.e., minimum expenditures) that maintain welfare after a change in prices. During 2009-2015, the aggregate price index (i.e., CPI) increased 3.08 percent annually to which price increases of energy, with a weight of 7.4 percent, contributed 0.23 percentage points, about equal to the mid-point CV and EV estimates from 0.18 to 0.30 percent of 2009 total expenditures. This CV or EV measures welfare losses from energy price increases assuming no change in total expenditures. However, total expenditures increased annually by over 3.0 percent which was more than enough compensation for welfare losses. But improved household energy end-use efficiency by “waste” reduction—in the 2011 Household Energy Consumption Survey—fully compensated the small welfare losses of 0.18 to 0.30 percent even without increasing total expenditures or investing in efficiency improvements. Waste exists because expenditure-minimizing “buyers” could be unwittingly wasteful as “users.”

Quantile Regression with Generated Regressors

This paper studies estimation and inference for linear quantile regression models with generated regressors. We suggest a practical two-step estimation procedure, where the generated regressors are computed in the first step. The asymptotic properties of the two-step estimator, namely, consistency and asymptotic normality are established. We show that the asymptotic variance-covariance matrix needs to be adjusted to account for the first-step estimation error. We propose a general estimator for the asymptotic variance-covariance, establish its consistency, and develop testing procedures for linear hypotheses in these models. Monte Carlo simulations to evaluate the finite-sample performance of the estimation and inference procedures are provided. Finally, we apply the proposed methods to study Engel curves for various commodities using data from the UK Family Expenditure Survey. We document strong heterogeneity in the estimated Engel curves along the conditional distribution of the budget share of each commodity. The empirical application also emphasizes that correctly estimating confidence intervals for the estimated Engel curves by the proposed estimator is of importance for inference.

The impact of the rise and collapse of Japan's housing price bubble on households’ lifetime utility

This study estimates the impact of the dramatic changes in housing prices during Japan's bubble from the late 1980s to the 1990s on households’ asset accumulation and utility over their life cycle. We construct a life-cycle model explaining households’ consumption/saving and housing decisions under collateral and borrowing constraints. We estimate this model using data from the Family Income and Expenditure Survey (FIES), which includes data on households’ housing wealth estimated from objective information. Using the estimated model, we then conduct a counterfactual simulation in which we assume that housing prices remained constant during the bubble period. Doing so allows us to quantify the gains/losses of lifetime utility due to the housing price boom and bust. We find that 72.2% of the households experienced an average decrease in lifetime utility equivalent to 5.7% of lifetime income. On average, Japan's housing price boom and bust caused a loss in lifetime utility equivalent to 4.7% of lifetime income. Moreover, we compare the impact of the housing price bubble across cohorts and find that the impact was greatest for those who experienced the bubble at ages 35–45.