Global Journal of Human Social Science, E: Economics, Volume 22 Issue 2

d) Measurement and identification instruments More dependent on the objective of the work than classification, the indication and measurement of the poverty penalty also takes place in different ways. Likewise, the measures used to indicate the aspects discussed in the different ways of classifying it. We saw above that Caplovitz (1963) measures in money the superior expenditures made by the poor for the same goods purchased by the rich and in a (greater) proportion the insolvent families who stopped paying for medical care. We have also seen that Prahalad (2005) measures the proportion that the price paid by the poor is greater than that paid by the rich for the same good. In addition to these forms, the example cited by Dalsace (2012) is representative of those most common in the specialized literature. The 2011 report by the Paris office of the Boston Consulting Group, cited by Dalsace (2012), presents the penalty of poverty measured in terms of the percentage of price paid more by the poor family, for expenses that occupy larger portions of their budgets, except food and transport [8] . Following the example of what was discussed about the classification of the penalty of poverty, the report cited by Dalsace (2012) also points out, for each type of expenditure, the possible cause of that penalty. As it only involves price, measurements such as those of the Boston Consulting Group hide possible effects of other variables involved in poverty penalty, in the broad sense of the concept, as discussed above, in addition to, in the example given, the market-based origin of the measurement is not clear, although the latter does not detract from the measurement made. Quality, the reference for price in the broad concept of that penalty, as well as the characteristics of the sociological context of each economic ecosystem, are hidden, or inaccessible, when the poverty penalty is measured only in terms of prices. In the case of quality, mainly, this was a criterion very clearly present in the basic understandings of the concept in Caplovitz (1963) and Prahalad (2005). There is no problem in starting to indicate the fine of poverty, only in terms of prices, but the quality variable with reference to which these are compared between the poor and the rich is a criterion for the origin of the concept. Thus, in order to identify the possibility of poverty penalty, one can consider what almost all the papers on the subject do, which is to deal with the difference between the prices paid by the poor and the non-poor for a similar commodity, but to verify its existence or not, it is necessary to have at least one quality parameter common to the goods being compared, although the ideal would be to compare the sociological parameters that influence the compared consumptions, such as the utilities for each consumer involved in the comparison. There are works, however, that approach the measurement of the poverty penalty in its broad sense and, thus, can be used to identify it in all aspects that need to be addressed in the fight against it. Attanasio & Frayne (2006), for example, test the existence of a poverty penalty controlled by the size effect and, for that purpose, consider the market as the environment of its origin, in terms of what their equations represent and do so as a function of price, quality, and package and distance effects. Three component aspects of the broad concept of the poverty penalty are therefore covered as well as two themes related to that concept. The authors' treatises assume that quality can be indicated by income level, which does not explain the sociological determinants of poverty penalty, which shape the economic ecosystem where poverty penalty takes place. It is imagined that the model of Attanasio & Frayne (2006) can be adapted to measure and identify the penalty of poverty. Attanasio & Frayne (2006), based on Deaton's (1988, 1997) theoretical framework generalized by Crawford et al (2003) write the following equation = + + (1) Where is the price paid in cluster , π is the quality measure, represents the measurement error and is the unobservable utility value to be maximized by the consumer for a good. These authors rewrite equation (1) as follows ln ic = 0 + ln + + ln + (2) Where 0 is an autonomous and exogenous determinant, different from the main effects considered; the terms e ln capture the demand for quality, being a vector of taste shifters and quantities. Then, a price schedule equation, determined by the supply side, is represented ln ic = + ln + (3) Where in ludes effects of costs and retail competitiveness and the coefficient of θ is expected to be negative, to show the size effect. It should be noted that cost and competitiveness effects are institutional components that shape the poverty penalty concept in its broad sense, as discussed above. Although equation (2) is not the demand curve, nor is equation (3) the supply curve, and in fact they were written to represent the possibilities of different price scales due to the size effect, when combining them, through a common variable, as those authors do later, we can interpret the market equilibrium curve under these conditions as the result of this. From the substitution of (3) in (2) Attanasio & Frayne (2006) arrive at the equation that can be understood as the one that represents the market equilibrium for different price levels Volume XXII Issue II Version I 26 ( ) Global Journal of Human Social Science - Year 2022 © 2022 Global Journals E Poverty Penalty: A Market-Based Review