Factor Analysis Versus Principal Component Analysis in the Case of "Infrastructural" Poverty Measurement
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Date
2007
Authors
Krasnikova, Larysa
Povoroznyk, B.
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Abstract
We consider alternative way of looking on the problem of poverty measurement based on asset index
method. Our decision is motivated by a number of measurement problems that prevent the use of monetary
metrics (consumption and income) of welfare in developing countries. We substantiate the conception
of "infrastructural" poverty that allows to define economic status of households in terms of assets of
wealth (durables) rather than in terms of monetary units (income and consumption). Factor Analysis
and Principal Component analysis are used for construction an asset index that is a refection of welfare
profile in terms of assets. We analyze the advantages of both methods in the asset index construction.
Description
Keywords
рівень бідності, концепція "інфраструктурної" бідності, активи, "infrastructural" poverty, Principal Component Analysis, PCA, FA, Factor analysis
Citation
Krasnikova L. Factor Analysis Versus Principal Component Analysis in the Case of "Infrastructural" Poverty Measurement / L. Krasnikova, B. Povoroznyk. // Наукові записки НаУКМА. - 2007. - Т. 68 : Економічні науки. - С. 34-40.