// definition
Equivalised disposable income
Household income adjusted for household composition
Short definition
Household disposable income divided by an equivalence factor that accounts for household size and composition. The modified OECD scale assigns one unit to the first adult, half a unit to each other person aged fourteen or over, and three tenths to younger children. Every member of a household is assigned the same statistical living standard.
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Knowledge map
Intuition
Comparing households of different sizes requires adjusting income for shared needs.
Formula
equivalised income = household disposable income / equivalence factorRelated analyses
Primary sources
- INSEE, standard of living definitionDisposable income, consumption units and the modified OECD scale. French-language source.