Background: Poverty and human capital development are inextricably linked and therefore research on human capital typically incorporates measures of economic well-being. In the context of randomized trials of health interventions, for example, such measures are used to:
- assess baseline balance;
- estimate covariate-adjusted analyses; and
- conduct subgroup analyses.
Many factors characterize economic well-being, however, and analysts often generate summary measures such as indices of household socio-economic status or wealth. In this paper, a household wealth index is developed and tested for participants in the cluster-randomized Sanitation, Hygiene, Infant Nutrition Efficacy (SHINE) trial in rural Zimbabwe.
Methods: Building on the approach used in the Zimbabwe Demographic and Health Survey (ZDHS), we combined a set of housing characteristics, ownership of assets and agricultural resources into a wealth index using principal component analysis (PCA) on binary variables. The index was assessed for internal and external validity. Its sensitivity was examined considering an expanded set of variables and an alternative statistical approach of polychoric PCA. Correlation between indices was determined using the Spearman’s rank correlation coefficient and agreement between quintiles using a linear weighted Kappa statistic. Using the 2015 ZDHS data, we constructed a separate index and applied the loadings resulting from that analysis to the SHINE study population, to compare the wealth distribution in the SHINE study with rural Zimbabwe.
Results: The derived indices using the different methods were highly correlated (r>0.9), and the wealth quintiles derived from the different indices had substantial to near perfect agreement (linear weighted Kappa>0.7). The indices were strongly associated with a range of assets and other wealth measures, indicating both internal and external validity. Households in SHINE were modestly wealthier than the overall population of households in rural Zimbabwe.
Conclusion: The SHINE wealth index developed here is a valid and robust measure of wealth in the sample.