2. Definition
Wealth is the value of all natural, physical and financial assets owned
by a household, reduced by its liabilities. Capturing wealth is not
easily done directly.
The wealth index (WI) is a composite index composed of key asset
ownership variables, The wealth index is used as a proxy indicator of
household level wealth. To construct the wealth index we need all the
indicators that allow us to understand the level of wealth of the
household.
Most research agencies use Social Map of the village as a basis for
sample selection.
3. What can it be used for?
Understanding socioeconomic differences within
communities, identifying target group members
before a project, program, or policy is changed or
implemented, or to determine the extent to which
targeting has proved successful after the event.
4. What does it tell you?
Ownership of or use rights to productive assets
local concepts of wealth, economic, and well-being
status
Economic and well-being profile of a community
social stratification at the community level
5. Procedures and Examples
1 Time, Materials, and Skills Needed
2 Possible Approach
3 Select Local Analysts
4 Provide Introductions and Explanations.
Produce a Wealth Ranking
Without a social map
After a social map
Analyze a Wealth Ranking.
6. Limitations
Wealth ranking gives a static picture and does not
easily convey poverty dynamics.
A narrow focus on ranking households does not
address the distribution of well-being within
households (such as by gender or age).
Wealth ranking might be a sensitive issue and some
might see a participatory or “public” exercise as
overly intrusive.
