Estimating an equivalence scale for Romania

Calculating the poverty rate, determining eligibility for social welfare benefits or any other analysis of the well‐being of families or households results in the transformation of these persons (rather than from the perspective of the size or structure of the family unit) into comparable families /households formed from so‐ called “equivalent adults”. This transformation is made with the help of equivalence scalesUnder the chosen equivalency scale, large households are “pushed” into poverty if an abrupt scale is used, similarly with smaller households if the scale is too straight. Which equivalence scales are most used? Under what circumstances does this scale correspond to the actual usage in our country’s households? Should different percentages be applied for children, elders, different genders or residential environment? Does the equivalency scale change over time? Here are a few questions we have tried to answer, while estimating an equivalency scale which reflects the actual behavior of our country’s households regarding consumption.