• Participatory wealth ranking

Participatory wealth ranking

An asset index method is a statistical method for ranking households according to their wealth. This paper outlines the methodology used to create a wealth index from household survey data. The aim of the study upon which this paper is based, was to create an index to differentiate between households both within and across seven different urban and rural communities in Thailand.

The author finds that an asset index is simpler to undertake than collecting income and expenditure data, which can be time-consuming and is difficult to record accurately. Other significant findings include:

• the index provides a way of differentiating between households, but it can never fully approximate the wealth of households which is complex and multidimensional, comprising many intangible factors which differ according to context
• to construct an asset index, it is necessary to have access to appropriate household survey data - an asset index is constrained by the survey material that it is based on
• for many regions there is no survey information available, and in these cases other techniques such as participatory wealth ranking exercises may provide an assessment of wealth more easily and with greater accuracy than a wealth index
• the major finding of this research is differences in levels of wealth between locations and regions - the wealth scores give valuable insights into the differences between communities and give a way of comparing diverse communities.

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