Dynamic properties of energy affordability measures


Heindl, Peter ; Schüssler, Rudolf


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URL: https://ub-madoc.bib.uni-mannheim.de/38864
URN: urn:nbn:de:bsz:180-madoc-388641
Document Type: Working paper
Year of publication: 2015
The title of a journal, publication series: ZEW Discussion Papers
Volume: 15-019
Place of publication: Mannheim
Publication language: English
Institution: Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Classification: JEL: I32 , D63 , Q48,
Keywords (English): Affordability measure , energy poverty , fuel poverty
Abstract: Measures of affordability are applied in practice, e.g., to assess the affordability of energy services, water or housing. They can be interpreted as measures of deprivation in a specific domain of consumption. The large body of literature on affordability measure has little overlap with the existing literature on poverty measurement. A comprehensive assessment of the response of affordability measures as a result of changes in the distribution of income or expenditure is missing. This paper aims to fill this gap by providing a conceptual discussion on the ‘dynamics’ of energy affordability measures. Several types of measures are examined in a microsimulation framework to assess their dynamic properties. Our results indicate that some measures exhibit odd dynamic behavior. This includes measures used in practice, such as the low income/high cost measure and the double median of expenditure share indicator. Odd dynamic behavior is attributed to definitions made with respect to higher moments of the expenditure distribution. Definitions that rely on a percentage share of expenditure relative to income or an absolute or relative income poverty line fare well from a dynamic perspective.

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Heindl, Peter ; Schüssler, Rudolf (2015) Dynamic properties of energy affordability measures. Open Access ZEW Discussion Papers Mannheim 15-019 [Working paper]
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