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Income Poverty and Multidimensional Deprivation

Working Paper 2009-106

Abstract

The study of multidimensional deprivation has become one of the most relevant lines of research in the analysis of low-income households. The search for significant relationships between multidimensional deprivation and income poverty has been a central issue and most empirical studies have found a very weak link. This paper aims at examining the possibility of an aggregation bias in national studies, which could conceal the diversity of experiences and patterns to be found in the different regions. Latent class models are used to define deprivation indices and the Spanish Survey on Income and Living Conditions is used. The results seem to show that the absence of significant relationships between both phenomena also appears when the sample of household is disaggregated regionally. Nonetheless, the decomposition of these two phenomena’s determinants reveals some common explanatory factors.

Authors: Luis Ayala , Antonio Jurado , Jesús Pérez-Mayo .

Keywords: poverty, multidimensional deprivation, regional analysis, EUSILC.
JEL: I31, I32