An index to measure socio economic status: asset approach

Objective: To develop an index to measure socio economic status using information on household assets.

 

Methodology: A set of standardized asset item weights, which would be finally summed up to generate an asset index for each household was computed. These standardized asset item weights were calculated by multiplying the factor score coefficients corresponding to each asset item by the standadized values (Z scores) of those asset items measured in the binary scale. Household asset data collected in the DHS survey 2000 was used in the calculations.

 

Results: The standardized asset item weights corresponding to different asset items, quintile cut off points of the asset index that could be used to measure socio economic status were presented.

 

Conclusion: The asset index could be viewed as a valid, reliable, and more feasible method of measuring socio economic status using only five simple questions.