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Measuring Personal Income

In this video Professor Melanie Luhrmann explains to Professor Michael Spagat the pitfalls of measuring personal income as well as possible solutions.

Professor Melanie Luhrmann (promoted from Dr. Luhrmann after we filmed the clip!) introduces yet another important idea into our measurement discussion.

Melanie is a Professor at Royal Holloway, University of London and a Research Fellow at the institute for Fiscal Studies. Her research interests are in applied microeconomics and public economics, particularly the analysis of education, health and family economics.

People may refuse to disclose sensitive information, such as their incomes, to survey interviewers. Melanie also points to a proven, if partial, solution: ask people to just place their incomes within wide income ranges instead of demanding precise income numbers. This method of dividing possible responses into broad ranges has the additional advantage of not requiring more precision than respondents actually know.


Can you think of ways to apply this insight to the measurement of other things besides income?

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