Transitions in Socioeconomic Status of Households in Egypt , 1998-2006: Evidence from Panel Survey Data

Ali Rashed, Population Council
Dina Armanious, Al-Azhar University, Cairo

Current study aims to assess the changes in the socioeconomic status of households in Egypt between 1998 and 2006. The study benefited from availability of panel data structure that extends over period of 8 years to underlie changes in the household socioeconomic status. Egypt Labor Market Surveys data (1998 and panel data 2006) was used. Principal Component Analysis (PCA) was used to construct three sub-indices that represent the three dimensions of socioeconomic status of households namely; household head, social and economic sub-index. In addition, the PCA was used to construct the composite socioeconomic status index. Two validation tests, internal coherence and comparison with the estimated expenditure were used to confirm the validity of the three sub-indices and SES index. The results of the study indicate that using PCA in extracting the first PC of the three sub-indices is the most appropriate method to extract the composite index.