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The Dynamics and Persistence of Poverty: Evidence from Italy

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  • Francesco Devicienti
  • Valentina Gualtieri
Abstract
This article studies the dynamics and persistence of poverty in Italy during the nineties, using the ECHP, 1994-2001. Various definitions of poverty are analyzed in parallel, income poverty, subjective poverty and a multidimensional index of life-style deprivation. For each poverty definition, the hazard rates of leaving poverty and re-entering into it are estimated and combined to compute a measure of poverty persistence that takes account of individuals’ repeated spells in poverty. The estimates provide a picture of high poverty turnover for the majority of the Italian population, which is true for any of the alternative definitions of poverty considered. Thus movements in and out of poverty cannot be simply related to spurious transitions due to measurement errors in household income. Multivariate exit and re-entry rate regressions are then estimated jointly to allow for correlated unobserved heterogeneity. The results highlight the role of demographic characteristics, the insufficiencies of the existing social security system and, above all, the weaknesses of the Italian labor market in generating persistent poverty for certain subgroups of the population.

Suggested Citation

  • Francesco Devicienti & Valentina Gualtieri, 2007. "The Dynamics and Persistence of Poverty: Evidence from Italy," LABORatorio R. Revelli Working Papers Series 63, LABORatorio R. Revelli, Centre for Employment Studies.
    • Handle: RePEc:cca:wplabo:63
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    1. Francesco Devicienti & Valentina Gualtieri & Mariacristina Rossi, 2014. "The Persistence Of Income Poverty And Lifestyle Deprivation: Evidence From Italy," Bulletin of Economic Research, Wiley Blackwell, vol. 66(3), pages 246-278, July.
    2. Ayllón, Sara & Fusco, Alessio, 2017. "Are income poverty and perceptions of financial difficulties dynamically interrelated?," Journal of Economic Psychology, Elsevier, vol. 61(C), pages 103-114.
    3. Nicola Amendola & Mariacristina Rossi & Giovanni Vecchi, 2012. "Vulnerability to Poverty in Italy," Working papers 007, Department of Economics, Social Studies, Applied Mathematics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino.
    4. Marjan, MAES, 2008. "Poverty persistence among Belgian elderly in the transition from work to retirement : an empirical analysis," Discussion Papers (ECON - Département des Sciences Economiques) 2008042, Université catholique de Louvain, Département des Sciences Economiques.
    5. J. You, 2011. "Evaluating poverty duration and transition: a spell-approach to rural China," Applied Economics Letters, Taylor & Francis Journals, vol. 18(14), pages 1377-1382.
    6. Andriopoulou, Eirini & Tsakloglou, Panagiotis, 2011. "The determinants of poverty transitions in Europe and the role of duration dependence," MPRA Paper 30659, University Library of Munich, Germany.
    7. Marjan Maes, 2013. "Poverty persistence among the elderly in the transition from work to retirement," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 11(1), pages 35-56, March.
    8. Matthew Lindquist & Gabriella Sjögren Lindquist, 2012. "The dynamics of child poverty in Sweden," Journal of Population Economics, Springer;European Society for Population Economics, vol. 25(4), pages 1423-1450, October.
    9. Veronica Polin & Michele Raitano, 2012. "Poverty Dynamics in Clusters of European Union Countries: Related Events and Main Determinants," Working Papers 10/2012, University of Verona, Department of Economics.
    10. Sara Ayllón, 2013. "Understanding poverty persistence in Spain," SERIEs: Journal of the Spanish Economic Association, Springer;Spanish Economic Association, vol. 4(2), pages 201-233, June.
    11. José Arranz & Olga Cantó, 2012. "Measuring the effect of spell recurrence on poverty dynamics—evidence from Spain," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 10(2), pages 191-217, June.
    12. Chenhong Peng & Lue Fang & Julia Shu-Huah Wang & Yik Wa Law & Yi Zhang & Paul S. F. Yip, 2019. "Determinants of Poverty and Their Variation Across the Poverty Spectrum: Evidence from Hong Kong, a High-Income Society with a High Poverty Level," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 144(1), pages 219-250, July.
    13. FUSCO Alessio, 2013. "The dynamics of perceived financial difficulties," LISER Working Paper Series 2013-24, Luxembourg Institute of Socio-Economic Research (LISER).
    14. Maes, Marjan, 2008. "Poverty persistence among Belgian elderly: true or spurious?," ISER Working Paper Series 2008-24, Institute for Social and Economic Research.
    15. Eisenhauer, Joseph G., 2011. "The rich, the poor, and the middle class: Thresholds and intensity indices," Research in Economics, Elsevier, vol. 65(4), pages 294-304, December.
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    17. Frank Adusah‐Poku & Kwame Adjei‐Mantey & Paul A. Kwakwa, 2021. "Are energy‐poor households also poor? Evidence from Ghana," Poverty & Public Policy, John Wiley & Sons, vol. 13(1), pages 32-58, March.

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    Keywords

    Poverty dynamics; poverty persistence; repeated spells; duration models; Italy.;
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