ABSTRACT
In what I will call income satisfaction methods, respondents are asked to rate their own income or standard of living on a particular scale, consisting of ordered categories. A typical question is: “How do you feel about your standard of living?” to which answers can be given on a seven point scale, ranging from “Terrible” to “Delighted”. Another question often used is “With your current household income, how can you make ends meet?” with six possible answers, ranging from “very difficultly” to “very easily”. (For further details and exact formulations, see table 7.A1.) While the answers to such questions can be used for a number of purposes (see, e.g., Andrews and Withey, 1976), I will only look at their application in the context of the study of living standards in general, and poverty in particular. Here they have been used mostly for the estimation of equivalence scales and poverty lines.
