Is Chronicity Growing? Exploring Intertemporal Poverty in Spain over Three Decades

Working Paper 2026-697

Abstract

Exploiting harmonised longitudinal income data over the period 1994-2023, this paper examines intertemporal poverty in Spain in the past three decades. To ensure that any single set of normative assumptions does not drive results, we rely on three methodologically distinct approaches that differ in their assumptions about income substitutabilityacross periods. We document two main findings. First, while the share of individuals experiencing at least one poverty spell has declined since the mid-1990s, all indicators pointto a substantial rise in the incidence and severity of chronic poverty, concentrated aroundthe Great Recession and sustained thereafter. Second, an Oaxaca-Blinder decompositionreveals that the observed decline in poverty exposure is largely a compositional effect, driven by improvements in individuals’ observable characteristics. Once these are heldconstant, both the probability of ever experiencing a poverty spell and the risk of chronic poverty have consistently increased since the mid-1990s, highlighting a structural weakening of the returns that observable characteristics have to prevent short and long-term deprivation.

Authors: Olga Cantó, Miguel Parra.