The effect of equivalence scales on poverty at Oblast level in Ukraine

Abstract

This paper aims at properly measuring and evaluating the impact of equivalence scales on poverty and inequality at both national and regional (Oblast) level in Ukraine. A new equivalence scale set is proposed and estimated on the basis of the UHLSC data; for some regions the precision of the estimate results as not being sufficient due to small sub-sample sizes. A variant of EBLUP small area estimation technique is proposed and implemented to estimate poverty measures properly and to reduce standard errors of such estimates; the variant concerned is based on a ratio approach: in this way the effect of the difficult-to-qualify institutional and historical factors, common to the country and its regions, is abstracted.