Chronic poverty: What affects its level and severity?

Abstract

The study focuses on the chronic or long-term poverty of the Russian population in the 2010s. To estimate the chronic poverty, Eurostat modified definition is applied. The level and factors of chronic poverty are estimated at the balanced panel data of the Russia Longitudinal Monitoring Survey subject to sample attrition effect. The main factors of falling into a long-term poverty trap are the presence of children, unemployment, living in rural areas, and frequent alcohol consumption. The risk of chronic poverty is lower if family members have tried to start their own business. The presence of retirement age persons in the family and children growing up reduce the risk of poverty. Extreme poverty, with all other things being equal, makes it harder for families to escape from chronic poverty. The main factors of chronic poverty severity are similar to those of chronic poverty. Some differences in the effects on chronic and transitory components of poverty severity are identified. It is noted that the increase in the coverage of the chronic poor with multiple deprivations by the conditional cash transfer program with the extended period of support and the increased assistance granted to these persons could contribute to the chronic poverty reduction.