Socioeconomic Characteristics of Households, Government Programs on Human Capital, and Natural Shocks as Determinants of Philippine Household Income Mobility

• Main Author: Pascua-Monsura, Melcah
• Format: text
• Published: Archīum Ateneo 2019
• Subjects: n/a
• Online Access: https://archium.ateneo.edu/theses-dissertations/439
• Institution: Ateneo De Manila University

This study introduced income mobility analysis to examine household’s welfare through time. Pseudo-longitudinal panel data generated from the Family Income and Expenditures Survey (FIES), through the household matching method, were used to identify the households included in the study. The Becker, Kominers, Murphy, and Spenkuch (BKMS) framework was utilized to determine the factors that affect income mobility. Ordinary least squares (OLS), multinomial logit, and multinomial probit regressions were used to explain absolute and relative income mobility, respectively. The findings showed that households’ income mobility was influenced by geographical location of the household, and household heads’ marital status, educational attainment, and occupation. In addition, government programs on health, education, and social welfare as investment in human capital development were significant factors of income mobility. On the other hand, because of the country’s preparedness and planning before the onset of a natural disaster and immediate solutions in the aftermath of a disaster, natural shocks were found to be an insignificant factor of income mobility. Furthermore, the unconditional and conditional income mobility estimates showed the evidence of income convergence between the poor and the rich. However, this convergence is faster when the previous income is conditioned by the different determinants of income mobility.