AboutHank Hokamp Expertise U. S. (American) History has been a hobby of mine for many a moon. Ask me a question about what happened in a certain year and I`ll tell you! My answer(s) won`t be boring!
Publications Champaign (IL) News-Gazette newspaper = Feature writer and City reporter. Will soon submit a 220 page non-fiction manuscript that deals with subjective thinking for publication.
Education/Credentials Two universities, one college and an institute. My major was Journalism with minors in American History and Sociology.
Awards and Honors 46 athletic awards, mostly in baseball and golf
Question Why is per capita income a good measure of the level of living people enjoy or are the data skewed?
Can you please explain the question to me I am not sure of what skewed means?
Answer
Hope you're having a GREAT day Michelle. Thanks for the question. I'll try to interpret your post:
In this case, SKEW means lopsidedness in a distribution. Easy to see in a histogram.
Since its introduction during World War II as a measure of wartime production capacity, the Gross National Product (now routinely measured as Gross Domestic Product—GDP) has become the nation's foremost indicator of economic progress. It is now widely used by policymakers, economists, international agencies and the media as the primary scorecard of a nation's economic health and well-being.
I hope this is what you're after, Michelle:
Family income distributions as typically produced mask the effects of income pooling and economies of scale within families, and DO NOT ALLOW for easy comparison of the economic well-being of different kinds of families. This is SKEWING! Adjusting family incomes for family size and composition enables a better comparison.
When average family size declines, as it did during the 1980s and 1990s, changes in family income averages tend to show families as worse off than they really are. Using the 40-30 family size adjustment, after-tax family incomes were 5% higher in 1999 than in 1980, compared with a 1% gain shown by unadjusted data.
The income distribution picture also varies depending on whether a family size adjustment is used or not. If families are ranked by after-tax income, the top 20% received roughly $8 for every $1 received by the bottom 20% in 1999. When re-ranked based on adjusted incomes, the gap narrows to approximately $5 versus $1.
Larger family sizes contribute to above-average family incomes, pushing averages up and making smaller families seem economically worse off than they actually are. Adjusting for family size makes for a fairer comparison of families of different sizes along the same relative scale.
Changes in the shares of various family types explain most of the declines in average family size between 1980 and 1999. Growth rates in the number of smaller families, including unattached individuals, lone parents, and couples without children, exceeded the overall rate. After the 40-30 adjustment, couples without children had the highest levels of spending power, on average, while lone-parent families were the worst off.
