Patterns of transition between poverty and prosperity in EU-SILC
N.T. Longford and C. Nicodemo
Abstract
In the established approaches to studying entries to and exits from poverty,
some relatively small changes in income of a household
from one year to the next are counted as transitions,
on par with much more substantial changes.
We explore some alternatives in which a household is regarded
as having made the full transition from one state to the other
only if its equivalized income has crossed the so-called grey zone
around the poverty threshold.
We introduce a partial scoring scheme for transitions
that do not clear the entire grey zone.
The methods are applied to the longitudinal component of
the European Union Statistics of Income and Living Conditions (EU-SILC)
for up to year 2007, in which data on household income is available
for three or four years for 21 European countries and for five years
for Luxembourg.
Submitted.
March 2010