MEASURING MATERIAL DEPRIVATION WITH EU-SILC: LESSONS FROM THE IRISH SURVEY

ABSTRACT

In this paper we consider the consequences for measurement of material deprivation, consistent poverty and economic vulnerability of the shift from the ECHP data set to the EU-SILC instrument. Despite the restricted number of deprivation items available in EU-SILC, we show that there is a substantial overlap between such measures when they are estimated using EU-wide and a set of Irish specific indicators. By placing the EU-wide measures in the context of the full range of Irish indicators, we demonstrate that they allow us to identify clusters of individuals sharply differentiated in terms of their multidimensional deprivation profiles. They also provide an understanding of the socio-economic factors associated with such differentiation that departs in only modest respects from that derived from the more comprehensive set of Irish specific indicators.

Keywords:

• income poverty
• material deprivation
• multidimensionality
• consistent poverty
• economic strain
• economic stress

We are grateful for the constructive comments on an earlier draft of this paper of the anonymous referees, participants in the EPUnet Annual Conference in April 2006, the EQUALSOC EU Network of Excellence Annual Conference in September 2006 and an ESRI seminar.

Notes

¹See Muffels and Fouarge (2004), Whelan et al. (2001, 2004), Tsakloglou and Papadopoulos (2002)

²See Eurostat (2005a) for a more detailed discussion

³See Eurostat (2005a, b).

⁴See Nolan and Whelan (1996) and Eurostat (2005b: 2).

⁵The Irish version of EU-SILC includes most of the deprivation indicators included in ECHP although the question wordings are not always identical.

⁶See Whelan et al. (2006), Whelan and Maître (2007).

⁷For further discussion of these issues see Nolan and Whelan (forthcoming).

⁸Such a scale is officially used in Ireland as it approximates the relationships implicit in major Irish social welfare schemes (Unemployment Benefit and Assistance and Supplementary Welfare Allowances) as they operated in 1987.

¹¹We also explored the possibility of making use of two items relating to ‘unmet need for medical or dental examination or treatment during the last 12 months because of lack of resources’. However, the items could not be unambiguously allocated to one of the clusters of items that we identify. This may be because their ability to tap the underlying resources element varies substantially across factors such as the life-cycle and eligibility for public services.

⁹See Davey Smith et al. (1994) and Gallie et al. (2003).

¹⁰For example see the papers in Achenson (1998).

¹²See Whelan et al. (2006) for a detailed discussion of these findings. Results from analysis using both tetrachoric correlations and Pearson correlations with such items show that the dimensionality findings are robust. See Eurostat (2005b).

¹³Note that this index differs substantially from that incorporated in the Irish National Anti-Poverty Strategy consistent poverty targets in that it includes a number of items relating to participation in family and social life. The terminology has also been changed.

¹⁴See Maître et al. (2006).

¹⁵The 11 items making up the Irish economic strain dimension are set out in detail in Appendix A.

¹⁶See Eurostat (2005b: 11).

¹⁷In comparison with Eurostat (2005b) this excludes the item relating to a colour TV where the level of enforced absence does not rise above 1 per cent in most countries. On the other hand it includes the item relating to coping with unanticipated expenses and the item relating to a PC; both of which contribute significantly to improving reliability.

¹⁸Since weighting by level of deprivation has no significant effect on our results we operate with unweigthed indices.

¹⁹Recent examples relating to Britain, New Zealand and the USA include McKay and Collard (2003), Perry (2002) and Short (2005) while Förster (2005) provides an example of a comparative European analysis.

²⁰See Callan et al. (1993), Nolan and Whelan, (1996) for early examples of this method and Maître et al. (2006) for a revised approach using EU-SILC data.

²¹A multinomial regression involving these categories available from the authors confirms these findings.

²²See Lazarsfeld and Henry (1968) and more recently Magidson and Vermunt (2004) and McCutcheon, and Mills (1998) for discussion of latent class models. Recent applications to the analysis of social exclusion include Moisio (2004) and Dewilde (2004), Whelan and Maître (2005 a & b).

²³We use the label economic stress for this variable rather than economic strain as in earlier work because Eurostat has taken to using the latter term for something close to the basic deprivation index employed in earlier Irish work on consistent poverty.

²⁴While the model provides a satisfactory fit to the data, it would of course be possible to specify a greater number of classes and identify further degrees of stratification within both the vulnerable and non-vulnerable classes.

²⁵Once again a multinomial regression analysis, which is available from the authors, confirms these findings.