HEIS Survey and income inequality in Iran?

The Iranian census called the Statistical Center of Iran (SCI) has been releasing household surveys that cover a wide range of variables including income, education, expenditure, etc. (Read Djavad Salehi-Isfahani’s post about the dataset).

There have been some efforts to use the dataset to infer about the state of income inequality in Iran. However, like any other household surveys, or maybe even more so for the case of Iran, the dataset is unable to capture the incomes of the richest sectors of the society. Besides that, due to the existence of large subsidies by the government (and the need-based nature of those programs), there is a tendency that individuals underreport their income in the survey reports (in most household income surveys, individuals choose not to report or withhold their income and wealth). I am not sure how this two factors together skew income inequality figures in the Iranian society but they’re important.

However, the good news is that consumption data is existent in HEIS and as much as data on income and wealth are not reliable, consumption data seems to be more trustworthy. Because of the tax structure, the rich in Iran is less likely to understate consumption. Unfortunately, unlike so many countries, there is not actual expenditure data releases by the Iranian government.

I like to see other types of surveys done by the Iranian government, such as survey data by relaying on a diary survey, asking individual to record their purchases for two weeks. It’s been shown that the method reduces the underreporting bias in typical survey data. In overall, any inference about income inequality in Iran has to be based on meticulous treatment of data.

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