TY - JOUR
T1 - A new poverty indicator for Europe
T2 - The extended headcount ratio
AU - Goedemé, Tim
AU - Decerf, Benoit
AU - Van den Bosch, Karel
N1 - Funding Information:
We are grateful to Tess Penne for providing the data with regard to the low-cost food baskets. For comments and suggestions, we would like to thank two anonymous reviewers as well as Gianni Betti, Mark Fransham, Brian Nolan, Marii Paskov, Juan Palomino and David Weisstanner and the other participants of various seminars at the Department of Social Policy and Intervention and the Institute for New Economic Thinking at the University of Oxford, and the In-GRID 2 Expert workshop on measuring and monitoring regional multidimensional poverty and cost of living, organised by the University of Pisa. The EU-SILC microdata were made available by Eurostat under contract RPP 77/2017-EU-SILC-HBS. Neither the funders, nor the data providers can be held responsible for the content of this article and any remaining shortcomings or errors, which are the sole responsibility of the authors. The author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: This study is supported by Citi through the Oxford Martin Programme on Inequality and Prosperity.
Publisher Copyright:
© The Author(s) 2022.
PY - 2022/7
Y1 - 2022/7
N2 - The methodology currently used to measure poverty in the European Union faces some important limitations. Capturing key aspects of poverty is done using a dashboard of indicators, which often tell conflicting stories. We propose a new income-based measure of poverty for Europe that captures in a consistent way in a single indicator the level of relative poverty, the intensity of poverty, poverty with a threshold anchored in time and a pan-European perspective on poverty. To do so, we work with a recently developed poverty index, the extended headcount ratio (EHC) and derive the relevant poverty lines to apply the index to poverty in Europe. We show empirically that our measure consistently captures the aspects typically monitored using a variety of indicators and yields rankings that seem more aligned with intuitions than those obtained by these individual indicators. According to our measure, Eastern Europe has a much higher level of poverty than Southern Europe, which, in turn, has a considerably higher level of poverty than North-Western Europe. In North-Western Europe, the evolution of our measure over time correlates most strongly with the at-risk-of-poverty rate, while in Southern and Eastern Europe, it correlates most strongly with at-risk-of-poverty with the threshold anchored in time.
AB - The methodology currently used to measure poverty in the European Union faces some important limitations. Capturing key aspects of poverty is done using a dashboard of indicators, which often tell conflicting stories. We propose a new income-based measure of poverty for Europe that captures in a consistent way in a single indicator the level of relative poverty, the intensity of poverty, poverty with a threshold anchored in time and a pan-European perspective on poverty. To do so, we work with a recently developed poverty index, the extended headcount ratio (EHC) and derive the relevant poverty lines to apply the index to poverty in Europe. We show empirically that our measure consistently captures the aspects typically monitored using a variety of indicators and yields rankings that seem more aligned with intuitions than those obtained by these individual indicators. According to our measure, Eastern Europe has a much higher level of poverty than Southern Europe, which, in turn, has a considerably higher level of poverty than North-Western Europe. In North-Western Europe, the evolution of our measure over time correlates most strongly with the at-risk-of-poverty rate, while in Southern and Eastern Europe, it correlates most strongly with at-risk-of-poverty with the threshold anchored in time.
KW - at-risk-of-poverty
KW - EU-SILC
KW - Europe
KW - Europe 2020 poverty reduction target
KW - extended headcount ratio
KW - Poverty
KW - social indicators
UR - http://www.scopus.com/inward/record.url?scp=85127199754&partnerID=8YFLogxK
U2 - 10.1177/09589287221080414
DO - 10.1177/09589287221080414
M3 - Article
AN - SCOPUS:85127199754
SN - 0958-9287
VL - 32
SP - 287
EP - 301
JO - Journal of European Social Policy
JF - Journal of European Social Policy
IS - 3
ER -