The author explores findings from the 1986 Longitudinal Supplement on Aging to determine the appropriateness of using proxy variables, including urban/rural location, as indicators of need among elderly residents. The application of regression models using proxies typical for distributional decisions against seven measures of need indicates that biasing in favor of rural elders may be an ineffective strategy. Reliance on proxy measures may result in inefficient and inequitable methods for distribution of funds within states. An expanded definition of need is recommended for distributional decisions.
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