RELATIVE INEQUALITY AND POVERTY IN GERMANY AND THE UNITED STATES USING ALTERNATIVE EQUIVALENCE SCALES

Abstract

We use data from the Luxembourg Income Study to show the sensitivity of measures of relative economic well‐being of persons in the U.S. and Germany using official equivalence scales and consumption‐based country‐specific equivalence scales developed for the two countries. Overall inequality and poverty levels are found not to be sensitive to the equivalence scale used. However, the official German equivalence scale yields quite different results from the others with respect to the relative income and poverty levels of vulnerable groups within the population, especially older single people.