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Inference for deprivation profiles in a binary setting

Maria Grazia Pittau, Pier Luigi Conti and Roberto Zelli

Journal of Econometrics, 2025, vol. 249, issue PB

Abstract: The paper addresses the issue of comparing deprivation distributions when the severity of deprivation is measured by a sum of (weighted) binary variables. To accomplish this task, it provides a graphical tool, the Three I’s of Deprivation (TID) curve, which summarises the incidence, intensity and inequality aspects of deprivation in a society and is the natural counterpart to the TIP curve widely used in income poverty analysis. Uncertainty around the estimated deprivation curves is assessed by simultaneous confidence bands. A dominance hypothesis test is presented to facilitate the comparison and ordering of TID curves across groups and over time. A rank-dependent multi-deprivation index consistent with the TID ordering is calculated and confidence intervals are developed. As a substantive illustration, the evolution of material and social deprivation across European countries over the period of the pandemic outbreak is analysed.

Keywords: Deprivation curves; Stochastic dominance; Binary variables; EU-SILC data (search for similar items in EconPapers)
JEL-codes: C12 C13 D63 I32 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:econom:v:249:y:2025:i:pb:s0304407625000545

DOI: 10.1016/j.jeconom.2025.106000

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