87 Determinants of Income Class in Philippine Households: Evidence from the Family Income and Expenditure Survey 2009 Stephen Jun Villejo, Mark Tristan Enriquez, Michael Joseph Melendres, Dexter Eric Tan, Peter Julian Cayton School of Statistics University of the Philippines Diliman We developed a model that can classify households based on their demographic profle and household assets. A methodology is then provided in the use of this model in identifying household- benefeciaries for some targetted interventions. Using the 2009 Family Income and Expenditure Survey (FIES), fve income clusters were identifed. In a generalized logistic regression model, geolocation of households, urbanity, employment status and education of household head, presence of some assets, and nature of housing units can signifcantly identify income class of a household. Keywords: mutlinomial logistic model, income determinants, clustering methods 1. Introduction The Family Income and Expenditure Survey of 2009 showed the estimate of Gini coeffcient, a meaure of income inequality and distribution, to be 0.4484 which is one of the highest in the Asian region (Ordinario, 2013). Because of the problem of income inequality, people from different classes have different capacity to pay and avail basic services. Those in the lower income classes will carry a greater burden to have access to social necessities. The government has instituted projects aimed at helping the poor, and has implemented mechanisms to make the services accessible to everyone. Example of projects which targets the poor with the ultimate goal of alleviating poverty are the following: Pantawid Kuryente (Katas ng VAT), a program that aims to give back to the poor the benefts reaped from the implementation of the expanded value added tax which targets families who consume electricity not more than 100 kilowatt hours a month; The Philippine Statistician Vol. 63, No. 2 (2014), pp. 87-104