Measuring the return on household enterprise: What matters most for whom?
Return on assets (ROA) of household enterprise is crucial for understanding the productivity of households in developing economies. Yet the definition and measurement of household enterprise ROA remain inconsistent or unclear. We illustrate potential measurement problems with examples from various s...
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| Format: | Article |
| Language: | en_US |
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2015
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| Online Access: | http://hdl.handle.net/1721.1/98864 https://orcid.org/0000-0002-1528-8102 |
| _version_ | 1826189108086571008 |
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| author | Samphantharak, Krislert Townsend, Robert |
| author2 | Massachusetts Institute of Technology. Department of Economics |
| author_facet | Massachusetts Institute of Technology. Department of Economics Samphantharak, Krislert Townsend, Robert |
| author_sort | Samphantharak, Krislert |
| collection | MIT |
| description | Return on assets (ROA) of household enterprise is crucial for understanding the productivity of households in developing economies. Yet the definition and measurement of household enterprise ROA remain inconsistent or unclear. We illustrate potential measurement problems with examples from various surveys. We take advantage of a detailed household survey and analyze what matters and for whom. The three issues that matter most for measurement of household enterprise ROA are the choice of accrual versus cash income, the treatment of household labor in enterprise income, and the treatment of non-factor income. This sensitivity matters most for a poorer region dominated by cultivation relative to a richer region with non-farm enterprises. Though the choice between accrued and cash income matters less when the frequency of the data declines, there remains high sensitivity in annualized data. We provide recommendations on how to improve the survey questionnaires for more accurate measurement in field research. |
| first_indexed | 2024-09-23T08:09:38Z |
| format | Article |
| id | mit-1721.1/98864 |
| institution | Massachusetts Institute of Technology |
| language | en_US |
| last_indexed | 2024-09-23T08:09:38Z |
| publishDate | 2015 |
| record_format | dspace |
| spelling | mit-1721.1/988642022-09-23T11:18:14Z Measuring the return on household enterprise: What matters most for whom? Samphantharak, Krislert Townsend, Robert Massachusetts Institute of Technology. Department of Economics Townsend, Robert Return on assets (ROA) of household enterprise is crucial for understanding the productivity of households in developing economies. Yet the definition and measurement of household enterprise ROA remain inconsistent or unclear. We illustrate potential measurement problems with examples from various surveys. We take advantage of a detailed household survey and analyze what matters and for whom. The three issues that matter most for measurement of household enterprise ROA are the choice of accrual versus cash income, the treatment of household labor in enterprise income, and the treatment of non-factor income. This sensitivity matters most for a poorer region dominated by cultivation relative to a richer region with non-farm enterprises. Though the choice between accrued and cash income matters less when the frequency of the data declines, there remains high sensitivity in annualized data. We provide recommendations on how to improve the survey questionnaires for more accurate measurement in field research. Eunice Kennedy Shriver National Institute of Child Health and Human Development (U.S.) National Science Foundation (U.S.) Templeton Foundation University of Chicago. Consortium on Financial Systems and Poverty Bill & Melinda Gates Foundation 2015-09-22T17:18:16Z 2015-09-22T17:18:16Z 2011-09 2011-08 Article http://purl.org/eprint/type/JournalArticle 03043878 http://hdl.handle.net/1721.1/98864 Samphantharak, Krislert, and Robert M. Townsend. “Measuring the Return on Household Enterprise: What Matters Most for Whom?” Journal of Development Economics 98, no. 1 (May 2012): 58–70. https://orcid.org/0000-0002-1528-8102 en_US http://dx.doi.org/10.1016/j.jdeveco.2011.09.001 Journal of Development Economics Creative Commons Attribution-Noncommercial-NoDerivatives http://creativecommons.org/licenses/by-nc-nd/4.0/ application/pdf MIT Web Domain |
| spellingShingle | Samphantharak, Krislert Townsend, Robert Measuring the return on household enterprise: What matters most for whom? |
| title | Measuring the return on household enterprise: What matters most for whom? |
| title_full | Measuring the return on household enterprise: What matters most for whom? |
| title_fullStr | Measuring the return on household enterprise: What matters most for whom? |
| title_full_unstemmed | Measuring the return on household enterprise: What matters most for whom? |
| title_short | Measuring the return on household enterprise: What matters most for whom? |
| title_sort | measuring the return on household enterprise what matters most for whom |
| url | http://hdl.handle.net/1721.1/98864 https://orcid.org/0000-0002-1528-8102 |
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