Comparing Single- and Multiple-Question Designs of Measuring Family Income in China Family Panel Studies

Abstract

Family income questions in general purpose surveys are usually collected with either a single-question summary design or a multiple-question disaggregation design. It is unclear how estimates from the two approaches agree with each other. The current paper takes advantage of a large-scale survey that has collected family income with both methods. With data from 14,222 urban and rural families in the 2018 wave of the nationally representative China Family Panel Studies, we compare the two estimates, and further evaluate factors that might contribute to the discrepancy. We find that the two estimates are loosely matched in only a third of all families, and most of the matched families have a simple income structure. Although the mean of the multiple-question estimate is larger than that of the single-question estimate, the pattern is not monotonic. At lower percentiles up till the median, the single-question estimate is larger, whereas the multiple-question estimate is larger at higher percentiles. Larger family sizes and more income sources contribute to higher likelihood of inconsistent estimates from the two designs. Families with wage income as the main income source have the highest likelihood of giving consistent estimates compared with all other families. In contrast, families with agricultural income or property income as the main source tend to have very high probability of larger single-question estimates. Omission of certain income components and rounding can explain over half of the inconsistencies with higher multiple-question estimates and a quarter of the inconsistencies with higher single-question estimates.