Individual Poverty Status Research Articles

The determinants of poverty exits and entries and the role of social benefits: the Italian case

This paper uses a novel micro econometric approach to analyze the impact of social benefits on the individual probabilities of poverty exit and entry in Italy, and their relative importance with respect to other socio-economic determinants of poverty transitions. Year to year transitions are defined as dichotomous variables capturing the changes of the individual poverty status, and are analyzed using random effects probit models estimated on pooled Italian data from 9 longitudinal components of IT-SILC covering the period 2004–2015. Our results show that social benefits strongly counteract the adverse effects of individual characteristics like unemployment, work intensity, inactivity, household size (and composition) and past poverty experience on the individual probabilities of poverty exit and entry. Despite their important effects on the individual probabilities of transitions, however, social benefits have a limited coverage among the vulnerable groups of the population, which strongly limits their aggregate impact on transition rates and poverty rates.

Income sources, intrahousehold allocation and individual poverty

Policies aimed at redistributing to the most vulnerable individuals must consider inequality within households as much as between households. In that spirit, many cash transfers are targeted at women rather than men. Tax legislations can also contain specific gender provisions that treat men and women differently. Whether these policies operate some intrahousehold redistribution, or are defeated by the household agency problem, is an open question. This paper provides new insights by adapting models of intrahousehold allocation to account for women's and men's net‐of‐tax earnings and targeted benefits as determinants of the household resource sharing function. We suggest applications using household expenditure data for Argentina and South Africa. Net‐of‐tax earnings and benefits commanded by women are often positively related to their and their children's resources. We provide counterfactual simulations to illustrate how women's financial power – and its sources – may modify their consumption share and thus their individual poverty status.

Education and Livelihood in Ghana: Evidence from Instrumental Variable Analysis

The research verified if schooling makes any difference in the consumption expenditure and poverty status of individuals in Ghana. Using the recent round of the Ghana Living Standards Survey data, we quantified the difference that schooling makes in the livelihood of individuals through the method of instrumental variables (IV). We found that individuals who have completed some level of schooling experience a significant increase in their consumption expenditure relative to those who have not been to school at all. Again, educated individuals who are poor had a significantly lower consumption expenditure compared to educated individuals who are non-poor. Also, individuals with some level of schooling had a lower probability to be poor compared to those without any schooling. We suggest massive investment in educational infrastructure and a revision of the schooling curriculum to equip individuals with workable skills that can enable them to undertake livelihood activities to improve their welfare.

Poverty in the Russian Federation: possibilities and specifics of the use of the AROPE multi-criteria index in the poverty monitoring system of the Russian Federation

The article presents a comparative analysis of the level and structure of poverty of the Russian population using two different concepts of poverty definition — the absolute income criterion currently used by Rosstat, and the AROPE indicator of poverty and social exclusion. The paper also attempts to assess how the change of the methodology for determining poverty can affect the existence of the poverty status of individuals. The study is carried out both at a national level and at a federal district level. The empirical basis of the paper is selective observation of income of the population and participation in social programmes, conducted by Rosstat in 2017.The results show that in transition from the absolute income criterion to the multi-criteria AROPE index, the poverty level of the population of the Russian Federation significantly increases. The highest growth of poverty is among people over working age. The age structure of poverty also changes significantly. With AROPE, the proportion of older persons among the poor increases and the proportion of children decreases. It is also shown in the article that the transition from the current official methodology of poverty definition to the definition in accordance with AROPE’s methodology can lead to loss of the poverty status by part of the population, which, in case of the official transition to using AROPE index as a criterion for receiving social support, can have a negative impact on their socio-economic situation. The obtained results vary significantly by federal districts of the Russian Federation.

Poverty is a Public Bad: Panel Evidence From Subjective Well‐Being Data

Previous research has found that subjective well‐being (SWB) is lower for individuals classified as being in poverty. We extend the poverty‐SWB literature by focusing on aggregate poverty. Using panel data for 39,239 individuals living in Germany from 2005–2013, we show that people's SWB is negatively correlated with the regional (state‐level) poverty ratio while controlling for individual poverty status and poverty intensity. This suggests that poverty is a public bad. The negative relationship between aggregate poverty and SWB is more salient in the upper segments of the income distribution and is robust to controlling for the rate of unemployment and per capita GDP. The character of poverty as a public bad suggests that poverty alleviation is a matter not only of distributive justice, but of allocative efficiency.

Poverty is a Public Bad: Panel Evidence from Subjective Well-Being Data

Previous research has found that subjective well‐being (SWB) is lower for individuals classified as being in poverty. We extend the poverty‐SWB literature by focusing on aggregate poverty. Using panel data for 39,239 individuals living in Germany from 2005–2013, we show that people's SWB is negatively correlated with the regional (state‐level) poverty ratio while controlling for individual poverty status and poverty intensity. This suggests that poverty is a public bad. The negative relationship between aggregate poverty and SWB is more salient in the upper segments of the income distribution and is robust to controlling for the rate of unemployment and per capita GDP. The character of poverty as a public bad suggests that poverty alleviation is a matter not only of distributive justice, but of allocative efficiency.

Community and Individual Risk Factors for Physical Child Abuse and Child Neglect: Variations by Poverty Status.

Families are impacted by a variety of risk and protective factors for maltreatment at multiple levels of the social ecology. Individual- and neighborhood-level poverty has consistently been shown to be associated with higher risk for child abuse and neglect. The current study sought to understand the ways in which individual- and neighborhood-level risk and protective factors affect physical child abuse and child neglect and whether these factors differed for families based on their individual poverty status. Specifically, we used a three-level hierarchical linear model (families nested within census tracts and nested within cities) to estimate the relationships between physical child abuse and child neglect and neighborhood structural factors, neighborhood processes, and individual characteristics. We compared these relationships between lower and higher income families in a sample of approximately 3,000 families from 50 cities in the State of California. We found that neighborhood-level disadvantage was especially detrimental for families in poverty and that neighborhood-level protective processes (social) were not associated with physical child abuse and child neglect for impoverished families, but that they had a protective effect for higher income families.

Escaping from poverty trap: a choice between government transfer payments and public services

BackgroundAnti-poverty has always been an important issue to be settled. What policies should be selected to help individuals escaping from the poverty trap: by directly offering transfer payments or indirectly providing public services? This paper is among the first to explore the effects of public anti-poverty programs system in China.MethodsWe Using unbalanced panel data of China Health and Nutrition Survey (CHNS) from 1989 to 2009, we demonstrate how the individual poverty status is determined through a four-staged simultaneous model. We choose the 3SLS (Three Staged Linear Squared) methodology to do the estimation.ResultsGTPs (Government Transfer Payments) don’t have positive effects on poverty reductions. The results demonstrate that GTPs increasing by 10% makes private transfer payments decrease by 3.9%. Meanwhile, GTPs increasing by 10% makes the household income decreased by 27.1%. However, public services (such as medical insurance, health services, hygiene protection etc.) have significantly positive impacts on poverty reduction. Public services share a part of living cost of the poor, and are conducive for people to gain higher household income.ConclusionsGTPs given by governments are not effective in reducing the poverty, as a result of “crowd-out effect” and “inductive effect”. However, public services are suggested to be adopted by governments to help the poor out of the poverty trap.

Intersections of individual and neighborhood disadvantage: Implications for child maltreatment

Parenting behaviors are influenced by numerous factors, including individual, family, and community contexts. Ecological systems theory suggests that these systems as well as interactions among the systems coalesce to influence the parent/child relationship in multiple ways. When challenges exist within and across these systems, child abuse and neglect can occur. While a significant body of research has delved into parsing the relative importance of neighborhood-level versus individual-level predictors, little is known about the complex ways in which interactions across ecological systems might enhance or hinder parenting behaviors. The current study seeks to fill this gap by answering the following research question: (1) Are there interactive effects of individual and neighborhood poverty on the risk of child maltreatment? Structural equation modeling was used to analyze data from 946 parents at Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) clinics in Franklin County, Ohio. Living in higher poverty neighborhoods is associated with higher levels of maltreatment irrespective of individual poverty status, but there is not a corresponding decrease for those living in lower poverty neighborhoods. These findings suggest that both individual poverty status and neighborhood poverty matter for child maltreatment and that there does not appear to be a compounding effect of being both poor and in a poor neighborhood, nor is there a protective effect when poor but living in a nonpoor neighborhood.

Race, Neighborhood Economic Status, Income Inequality and Mortality.

Mortality rates in the United States vary based on race, individual economic status and neighborhood. Correlations among these variables in most urban areas have limited what conclusions can be drawn from existing research. Our study employs a unique factorial design of race, sex, age and individual poverty status, measuring time to death as an objective measure of health, and including both neighborhood economic status and income inequality for a sample of middle-aged urban-dwelling adults (N = 3675). At enrollment, African American and White participants lived in 46 unique census tracts in Baltimore, Maryland, which varied in neighborhood economic status and degree of income inequality. A Cox regression model for 9-year mortality identified a three-way interaction among sex, race and individual poverty status (p = 0.03), with African American men living below poverty having the highest mortality. Neighborhood economic status, whether measured by a composite index or simply median household income, was negatively associated with overall mortality (p<0.001). Neighborhood income inequality was associated with mortality through an interaction with individual poverty status (p = 0.04). While racial and economic disparities in mortality are well known, this study suggests that several social conditions associated with health may unequally affect African American men in poverty in the United States. Beyond these individual factors are the influences of neighborhood economic status and income inequality, which may be affected by a history of residential segregation. The significant association of neighborhood economic status and income inequality with mortality beyond the synergistic combination of sex, race and individual poverty status suggests the long-term importance of small area influence on overall mortality.

Financial Well-Being of Individuals Living in Areas with Concentrated Poverty

Much of the attention to income inequality and poverty is focused on individual level circumstances. However, researchers have also observed that living in an area of concentrated poverty may result in additional disadvantages to individuals beyond that which results from their own individual poverty status.

Racial Disparities in Poverty Status among Families of Individuals with Spinal Cord Injury

AbstractBackground: Poverty rates among individuals with disabilities are much higher than for the general U.S. population. However, little is known about the likelihood of poverty among families of those with Spinal Cord Injury (SCI). Objectives: Examine the association of pre‐injury and post‐injury education with the likelihood of familial poverty by race/ethnicity for 1,405 adults between the ages of 18 and 64 who had a traumatic spinal cord injury at least one year prior to the study interview (2003). Methods: Based on reported household income in 2002, familial poverty status of individuals with a SCI was determined based on United States (U.S.) Federal Poverty Guidelines during the year of reported income. Based on a conceptual model of human capital loss and acquisition, a model of the likelihood of poverty was estimated separately for Non‐Hispanic White and Black/Hispanic families. Results: 18.33% of Non‐Hispanic White families and 42.35% of Black/Hispanic families with a member having SCI were found to be living below the poverty level. Bachelor's degree education attainment was the most important factor and was significantly associated with a lower likelihood of familial poverty for Non‐Hispanic White (‐0.10) and for Black/Hispanic families (‐0.27). Conclusions: We have proposed that the Social Security Administration grant presumptive disability eligibility for SCI, guarantee continued medical benefits after employment and pilot an online college degree reimbursement plan to reduce poverty among families of individuals with SCI.

The Impact of Human Capital on Urban Poverty: The Case of Sargodha City

The positive relationship between human capital and income/wages has been supported by empirical research. Millennium Development Goals (MDGs) and the Poverty Reduction Strategy Paper (PRSP) enormously emphasize on human capital for curbing poverty. The economic development in East Asian countries is also linked with investment in education for the development of human capital. This study is designed to investigate the relationship of different levels of education and experience upon urban poverty at medium sized city in Pakistan such as Sargodha. A survey-based analysis was carried out on a sample of 330 households. Poverty status of the individual is defined by using adjusted official poverty line. Results show that education and experience is negatively related with the poverty status of individuals and this fact sustains even in separate gender estimates as well. This implies education of poor is necessary in breaking the vicious circle of poverty. Combined effort by public, private, community participation and NGO’s with special focus on elementary (Primary and middle) education is suggested for reducing poverty by increasing the productivity of the poor through education.

Measuring State Dependence in Individual Poverty Status: Are There Feedback Effects to Employment Decisions and Household Composition?

Using a sample of prime-aged men from the German Socio-Economic Panel (GSOEP), this paper examines the effects of past poverty experience on future poverty status, future employment status and household composition. The empirical results suggest that even after controlling for observed and unobserved characteristics, past poverty experience increases the poverty risk of future periods. Moreover, there is evidence that experiencing poverty has a negative effect on future employment behaviour and on household cohesion. Apart from its economic significance, the existence of such feedback effects is interesting from an econometric point of view, as they represent a violation of the strict exogeneity assumption, which is usually invoked in estimating dynamic qualitative response models with unobserved heterogeneity.