Single adult households are taken as the reference group and are given a value of 1. For larger households, each additional adult is given a smaller value of 0.5 to reflect the economies of scale achieved when people live together, arising when households share resources such as water and electricity, which reduces living costs per person. Children under the age of 14 are given a value of 0.3 to take account of their lower living costs, while children aged 14 and over are given a value of 0.5 because their living costs are assumed to be the same as an adult.