Estimating wealth effects without expenditure data : an asset based wealth index for rural Ethiopia

In economic studies household economic status is usually proxied by measures of consumption or income. In recent years, several studies have advanced an asset-based index as an alternative measure of wealth status. Compared to measures based on consumption, the data required to construct such indices are less demanding and the measure is simpler to calculate. In most studies the asset-based wealth index is constructed with a standard list of assets comprising household ownership of consumer durables, the characteristics of the household's dwelling and sometimes household landownership. These indices have been used to estimate the effect of long term economic status on socio-economic outcomes such as health status or children's school enrolment.