The German Capability Index—An Operationalization of Sen’s …
151
The EVS database characterizes a household [18] as an individual with own
income who economizes for herself/himself as well as a group of related or personally
linked people who belong together according to their income as well as according to
their consumption. The latter must live together and dispose together of one or several
incomes or income shares as well as supply a joint household [18]. Households are
analysed according to their social characteristics and their net income [18]. The
net income of the households is calculated by subtracting income tax, church tax,
solidarity tax and social insurance from the gross income [18]. The disposable income
of the chosen social groups is identified by adding to the net income the earnings from
good sales as well as other income modes. Not included in the disposable income
are earnings from the liquidation and conversion of monetary and material property
as well as from borrowing [18]. The savings of the households cover the expenses
for the development of financial and tangible assets and repayment of credits [18].
For this analysis, we use the data of 40.6 million households in Germany
covering the following household groups: all households (40.6 million), single
women (10.6 million), single men (6.5), single parents (1.2 million), couples without
children (11.7 million) and couples with children (5.8 million) with further differentiation between the following income groups: under 900, 900–1300, 1300–1500, 1500–
2000, 2000–2600, 2600–3600, 3600–5000, 5000–18,000 e [19, 20]. The group of
other households
2 (4.9 million) will not be analysed. We use the data on income
and expenditures of these households to define their material functionings: earnings,
savings, food, beverages, tobacco, clothing and shoes, living, household tools and
furniture, health, transport, communications, entertainment, leisure time, education,
restaurants and services [18]. The data “living without energy” contains the hot, cold
and waste water costs of the households, but it is not possible to further differentiate
between these respective water costs. Hence, the following FEW-nexus expenditure
costs are the minimum expenses of the households for the FEW-nexus goods.
Table 1 shows that FEW-nexus expenditures account for more than 20% of the
expenditures of the average German household. In the lowest income group, the
households spend on average 30% of their consumption expenditures for the FEWnexus resources. With growing income, the nexus share decreases to 24% in the
highest income group. The importance of the FEW-nexus expenditures for the households decreases with increasing income. The FEW-nexus commodities are relative
inferior
3 goods.
Table 2 shows the expenditure structure of the single woman households. The
single woman households spend on average 352 e for FEW-nexus products. In the
lowest income group, the households spend only 251 e per month for FEW-nexus
commodities. This value increases with rising income to 514 e in the highest income
group. On average 21.4% of the household consumption expenditures are allocated
to the FEW-nexus goods. This percentage share has its highest value with 28.4%
2 Other households are those household which have further household members (e.g. parents-in-law,
children of full age) [18].
3 A detailed explanation of inferior, normal and superior goods can be found by Krugman and Wells
[37] and Wied-Nebbeling [84].
151
The EVS database characterizes a household [18] as an individual with own
income who economizes for herself/himself as well as a group of related or personally
linked people who belong together according to their income as well as according to
their consumption. The latter must live together and dispose together of one or several
incomes or income shares as well as supply a joint household [18]. Households are
analysed according to their social characteristics and their net income [18]. The
net income of the households is calculated by subtracting income tax, church tax,
solidarity tax and social insurance from the gross income [18]. The disposable income
of the chosen social groups is identified by adding to the net income the earnings from
good sales as well as other income modes. Not included in the disposable income
are earnings from the liquidation and conversion of monetary and material property
as well as from borrowing [18]. The savings of the households cover the expenses
for the development of financial and tangible assets and repayment of credits [18].
For this analysis, we use the data of 40.6 million households in Germany
covering the following household groups: all households (40.6 million), single
women (10.6 million), single men (6.5), single parents (1.2 million), couples without
children (11.7 million) and couples with children (5.8 million) with further differentiation between the following income groups: under 900, 900–1300, 1300–1500, 1500–
2000, 2000–2600, 2600–3600, 3600–5000, 5000–18,000 e [19, 20]. The group of
other households
2 (4.9 million) will not be analysed. We use the data on income
and expenditures of these households to define their material functionings: earnings,
savings, food, beverages, tobacco, clothing and shoes, living, household tools and
furniture, health, transport, communications, entertainment, leisure time, education,
restaurants and services [18]. The data “living without energy” contains the hot, cold
and waste water costs of the households, but it is not possible to further differentiate
between these respective water costs. Hence, the following FEW-nexus expenditure
costs are the minimum expenses of the households for the FEW-nexus goods.
Table 1 shows that FEW-nexus expenditures account for more than 20% of the
expenditures of the average German household. In the lowest income group, the
households spend on average 30% of their consumption expenditures for the FEWnexus resources. With growing income, the nexus share decreases to 24% in the
highest income group. The importance of the FEW-nexus expenditures for the households decreases with increasing income. The FEW-nexus commodities are relative
inferior
3 goods.
Table 2 shows the expenditure structure of the single woman households. The
single woman households spend on average 352 e for FEW-nexus products. In the
lowest income group, the households spend only 251 e per month for FEW-nexus
commodities. This value increases with rising income to 514 e in the highest income
group. On average 21.4% of the household consumption expenditures are allocated
to the FEW-nexus goods. This percentage share has its highest value with 28.4%
2 Other households are those household which have further household members (e.g. parents-in-law,
children of full age) [18].
3 A detailed explanation of inferior, normal and superior goods can be found by Krugman and Wells
[37] and Wied-Nebbeling [84].