poor from the non-poor? This issue is discussed in Section 10, which reveals the relative disparity suffered by the poor compared to the non-poor in terms of several non-income indicators of people’s well-being. Section 11. presents a multivariate regression model of household welfare. Finally, Section 12 offers concluding observations. ‘The paper contains three appendices. Appendix I discusses the components of consumption that were used in the measurement of individual welfare. Appendix 2 provides a detailed discussion of the new poverty lines have been constructed for Lao PDR. The construction of the new poverty line depends critically on the spatial price indices. The methodology used for constructing the spatial price indices is presented in Appendix 3. 2. Primary data source ‘The poverty analysis for Lao PDR is based on two national surveys, LECS I for 1992- 93 and LECS Il for 1997-98, conducted by the National Statistical Centre (NSC). Both surveys covered rural and urban areas of all provinces and were nationally representative. ‘The sample frame from which the samples were selected covered the entire population of Lao PDR. The sample design involved both stratification and clustering. LECS I surveyed 2937 households in 1992-93. The sample was stratified across 17 provinces from which 147 villagés were chosen as the primary sampling units (PSUs). LECS II enlarged the sample size to 882 households across 18 provinces’ in 1997-98. The 18 provinces were stratified by urban, and rural with and without access to roads, thus resulting in 54 strata, from which 450 villages were chosen as PSUs. The survey instruments include the village questionnaire, the household questionnaire, and the diary sheet. The village questionnaire collected village-level information én physical infrastructure, access to services, and a variety of other village attributes. But it did not collect information on prices for either food or nonfood items, with the sole exception of sticky rice for which prices were collected in LECS Il. The household questionnaire obtained information at the household or individual level on a broad range of topics, including demographic characteristics, education attainment, * Counting Vientiane Municipality as a separate province,