The Prince and the Pauper Revisited: A Bootstrap Approach to Poverty and Income Distribution Analysis Using the PACO Data Base

In this paper, we are using bootstrap methods to perform statistical inference for poverty and inequality indices. Using 1992 cross-sectional household data from the Panel Comparability Project (PACO), we show that the probability that a household headed by a retired person is poor is significantly higher in the United Kingdom than in Hungary or Luxembourg. We also show that the average shortfall from the poverty line is much larger for poor households in Hungary and the United Kingdom than for poor households in Luxembourg. This suggests that poverty spells are also longer in Hungary and the United Kingdom than they are in Luxembourg.