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A Proposal of a Synthetic Indicator to Measure Poverty Intensity, With an Application to EU-15 Countries

Jose Nuñez-Velazquez () and Juana Domínguez-Domínguez ()
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Juana Domínguez-Domínguez: Departamento de Estadística, Estructura Económica y O.E.I. Universidad de Alcalá

No 81, Working Papers from ECINEQ, Society for the Study of Economic Inequality

Abstract: This paper deals with the proposal of a synthetic indicator to measure intensity of poverty. So, whereas incidence of poverty can be clearly measured using the headcount ratio indicator, according to Sen (1976) dimensions of poverty, the choice of a better intensity poverty measure is still an open question to resolve. Thus, in this paper, a new procedure to obtain a synthetic indicator from a set of well-performed poverty intensity indices as a start is proposed, using an adaptation of Principal Component Analysis (PCA). Conditions needed to make longitudinal comparisons possible are studied and properties of these synthetic indicators will also be analyzed, connected to TIP curves as well. As an illustration, this paper analyzes the evolution of poverty in the 15 countries of E.U., whose household income data are available through the information contained in the European Community Household Panel (ECPH). This analysis allows static and dynamic comparisons, related to the period from 1993 to 2000. Furthermore, the determination of groups of countries according to their characteristics in poverty will be accomplished.

Keywords: Economic Poverty; TIP’s poverty curves; Poverty in EU countries; PHOGUE. (search for similar items in EconPapers)
JEL-codes: C43 D31 I32 O52 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2007
New Economics Papers: this item is included in nep-eec and nep-hap
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