A comparative evaluation of poverty measures in the Italian Survey of Household Income and Wealth

Giovanni D'Alessio

Politica economica, 2020, issue 1, 101-140

Abstract: I provide a comparative study of the most frequently used poverty indices,obtained by modifying the welfare indicator (income, consumption, income and/or wealth),the equivalence scale (OECD or square root of the number of components), local deflatorsand the statistic for the poverty threshold (average or median). I also examine the EquivalentEconomic Situation Index (ISEE is the Italian acronym), an administrative indicator used toaccess social benefits that combines income and assets and has a specific equivalence scale.Using data from the Bank of Italy’s surveys of household income and wealth (SHIW) I firststudy how the incidence of poverty varies according to different combinations of welfare indicators,equivalence scales and poverty thresholds; subsequently I investigate how the differentvariants are associated with an indicator of perceived bad economic conditions. The investigationyields a wide variety of results as for the poverty rate and the composition of the poor.The highest association with the perceived poor economic conditions is found for indicatorscombining income and wealth; the association with consumption is rather weak.

Keywords: income; consumption; wealth; poverty; equivalence scales; spatial deflator; ISEE. (search for similar items in EconPapers)
Date: 2020
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Working Paper: A comparative evaluation of poverty measures in the Italian Survey of Household Income and Wealth (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:mul:je8794:doi:10.1429/97787:y:2020:i:1:p:101-140

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