Unit of analysis: the household

The unit of analysis chosen for the DHEA is the household, defined by the OECD as “either an individual person or a group of persons who live together under the same housing arrangement and who combine to provide themselves with food and possibly other essentials of living”. The SFS data is available at the family unit level which is comprised of unattached individuals and economic families defined as a group of two or more persons who live in the same dwelling and are related to each other by blood, marriage, common-law or adoption. For the DHEA project the family units have been aggregated to the household level by combining family units that reside at the same address. This results in a unit definition that includes people who share resources but are not necessarily related by blood, marriage, common-law or adoption, and brings the SFS data as close as possible to the OECD household definition.

Related to this concept is the OECD recommendation to estimate distributions based on equivalized household values. This process takes into account differences in household size and composition and the resulting economies of scale for income and consumption. Wealth data presented in the latest estimates have not been equivalized. This will be investigated for future releases, when an integrated picture of income, consumption and wealth distributions is developed.