Explaining Differences Within and Between Countries in the Risk of Income Poverty and Severe Material Deprivation: Comparing Single and Multilevel Analyses

  • Pim VerbuntEmail author
  • Anne-Catherine Guio


This study investigates the differences between the risk factors of income poverty and severe material deprivation by assessing to what extent both indicators are subject to the same underlying household-level and country-level determinants. Given that these two indicators encompass the majority of the Europe 2020 social inclusion target group, it is crucial for policy makers to better know which determinants are effective in explaining the differences within and between countries in the risk of these two target components. We employ a series of single-level and multilevel logistic multinomial models to explain differences between those who suffer from income poverty ‘only’, from severe material deprivation ‘only’, from both problems and none. The comparative use of single-level and multilevel methods allow for the first time to confront the respective within and between-country explanatory power of both types of models. In addition to the usual econometric approach of identifying significant relationships, we employed the Shapley decomposition method to compare the relative contribution of independent variables at the household-level (i.e. work intensity, household education, household costs, socio-demographic variables) and country-level (i.e. size of social spending (total, in-cash, in-kind), pro-poorness of social benefits, median income levels and the unemployment rate) to within and between-country explained variance measures. We apply our method to the cross-sectional European Union Statistics on Income and Living Conditions for the year 2012.


Europe 2020 social exclusion target group Income poverty Severe material deprivation Single-level and multilevel multinomial logistic regression model Shapley decomposition Social spending 


Compliance with Ethical Standards

Conflict of interest

The authors declare that they have no conflict of interest.


  1. Bäckman, O., & Ferrarini, T. (2010). Combating child poverty? A multilevel assessment of family policy institutions and child poverty in 21 old and new welfare states. Journal of Social Policy, 39(2), 275–296.CrossRefGoogle Scholar
  2. Bárcena-Martín, E., Blanco-Arana, M. C., & Pérez-Moreno, S. (2016). Assessing the impact of social transfer income packages on child poverty in European countries: Pro-child targeting vs pro-poor targeting (No. 410).Google Scholar
  3. Bárcena-Martín, E., Blasquez, M., Budria, S., & Moro-Egido, A. (2017). Child deprivation and social benefits: Europe in cross-national perspective. Socio-Economic Review, 15(4), 717–744.CrossRefGoogle Scholar
  4. Bárcena-Martín, E., Lacomba, B., Moro-Egido, A. I., & Pérez-Moreno, S. (2014). Country differences in material deprivation in Europe. Review of Income and Wealth, 60(4), 802–820.Google Scholar
  5. Berthoud, R., & Bryan, M. (2011). Income, deprivation and poverty: A longitudinal analysis. Journal of Social Policy, 40(01), 135–156.CrossRefGoogle Scholar
  6. Boarini, R., & d’Ercole, M. M. (2006). Measures of material deprivation in OECD countries. In: Social, Employment and Migration Working Papers No. 37, OECD, Paris.Google Scholar
  7. Bosco, B., & Poggi, A. (2016). Government effectiveness, middle class and poverty in the EU: A dynamic multilevel analysis. In: DEMS Working Paper Series No. 344.Google Scholar
  8. Brady, D. (2005). The welfare state and relative poverty in rich western democracies, 1967–1997. Social Forces, 83(4), 1329–1364.CrossRefGoogle Scholar
  9. Brady, D., Fullerton, A. S., & Cross, J. M. (2009). Putting poverty in political context: A multi-level analysis of adult poverty across 18 affluent democracies. Social Forces, 88(1), 271–299.CrossRefGoogle Scholar
  10. Brady, D., & Kall, D. (2008). Nearly universal, but somewhat distinct: The feminization of poverty in affluent Western democracies, 1969–2000. Social Science Research, 37(3), 976–1007.CrossRefGoogle Scholar
  11. Browne, W. J. (2015). MCMC estimation in MLwiN. Centre for Multilevel Modelling, University of Bristol.Google Scholar
  12. Callens, M., & Croux, C. (2004). Poverty dynamics in Europe. A multilevel discrete-time recurrent hazard analysis. DTEW Research Report, 0457, 1–30.Google Scholar
  13. Charpentier, A., & Mussard, S. (2011). Income inequality games. The Journal of Economic Inequality, 9(4), 529–554.CrossRefGoogle Scholar
  14. Chzhen, Y. (2014). Child poverty and material deprivation in the European Union during the Great Recession. UNICEF Innocenti Research Centre, 723.Google Scholar
  15. Chzhen, Y., & Bradshaw, J. (2012). Lone parents, poverty and policy in the European Union. Journal of European Social Policy, 22(5), 487–506.CrossRefGoogle Scholar
  16. Copeland, P., & Daly, M. (2012). Varieties of poverty reduction: Inserting the poverty and social exclusion target into Europe 2020. Journal of European Social Policy, 22(3), 273–287.CrossRefGoogle Scholar
  17. Council Decision of 22 July 1975 concerning a programme of pilot schemes and studies to combat poverty (1975).Google Scholar
  18. De Graaf-Zijl, M., & Nolan, B. (2011). Household joblessness and its impact on poverty and deprivation in Europe. Journal of European Social Policy, 21(5), 413–431.CrossRefGoogle Scholar
  19. Deutsch, J., & Silber, J. (2006). The “fuzzy set” approach to multidimensional poverty analysis: Using the shapley decomposition to analyze the determinants of poverty in Israel. In A. A. ​Lemmi & G. Betti (Eds.), Fuzzy set approach to multidimensional poverty measurement (Vol. 3, pp. 115–174). New York: Springer Science & Business Media.CrossRefGoogle Scholar
  20. Dewilde, C. (2008). Individual and institutional determinants of multidimensional poverty: A European comparison. Social Indicators Research, 86(2), 233–256.CrossRefGoogle Scholar
  21. Diris, R., Vandenbroucke, F., & Verbist, G. (2017). The impact of pensions, transfers and taxes on child poverty in Europe: The role of size, pro-poorness and child orientation. Socio-Economic Review, 15(4), 745–775.Google Scholar
  22. Fusco, A., Guio, A.-C., & Marlier, E. (2011). Characterising the income poor and the materially deprived in European countries. In A. Atkinson & E. Marlier (Eds.), Income and living conditions in Europe (pp. 132–153). Luxembourg City: Eurostat.Google Scholar
  23. Guio, A.-C. (2009), What can be learned from deprivation indicators in Europe?, Eurostat Methodologies and Working Papers, Publications office of the European Union, Luxembourg.Google Scholar
  24. Guio, A. C., Fusco, A., & Marlier, E. (2010). Risk factors of income poverty and material deprivation in Belgium and Regions. IWEPS.Google Scholar
  25. Guio, A-C., Gordon, D., & Marlier, E. (2012), Measuring Material Deprivation in the EU. Indicators for the whole Population and Child-Specific Indicators, Eurostat Methodologies and Working Papers, Publications office of the European Union, Luxembourg.Google Scholar
  26. Guio, A-C., Gordon, D., Najera H., & Pomati, M. (2017), Revising the EU material deprivation variables (analysis of the final 2014 EU-SILC data)- Whole population MD indicator, Eurostat Methodologies and Working Papers, Publications office of the European Union, Luxembourg.Google Scholar
  27. Kenworthy, L. (2011). Public services are an important antipoverty tool. In L. Kenworthy (Ed.), Progress for the poor. Oxford: Oxford University Press.CrossRefGoogle Scholar
  28. Kenworthy, L., Epstein, J., & Duerr, D. (2011). General social policy reduces material deprivation. In L. Kenworthy (Ed.), Progress for the poor. Oxford: Oxford University Press.CrossRefGoogle Scholar
  29. Kim, K. S., Lee, Y., & Lee, Y. J. (2010). A multilevel analysis of factors related to poverty in welfare states. Social Indicators Research, 99(3), 391–404.CrossRefGoogle Scholar
  30. Korpi, W., & Palme, J. (1998). The paradox of redistribution and strategies of equality: Welfare state institutions, inequality, and poverty in the Western countries. American Sociological Review, 63(5), 661–687.CrossRefGoogle Scholar
  31. Lohmann, H. (2009). Welfare states, labour market institutions and the working poor: A comparative analysis of 20 European countries. European Sociological Review, 25(4), 489–504.CrossRefGoogle Scholar
  32. Marx, I., Salanauskaite, L., & Verbist, G. (2013). The paradox of redistribution revisited: And that it may rest in peace?. In GINI Discussion Paper No. 82.Google Scholar
  33. McKelvey, R. D., & Zavoina, W. (1975). A statistical model for the analysis of ordinal level dependent variables. Journal of Mathematical Sociology, 4(1), 103–120.CrossRefGoogle Scholar
  34. Meuleman, B., & Billiet, J. (2009). A Monte Carlo sample size study: How many countries are needed for accurate multilevel SEM? Survey Research Methods, 3(1), 45–58.Google Scholar
  35. Moller, S., Huber, E., Stephens, J. D., Bradley, D., & Nielsen, F. (2003). Determinants of relative poverty in advanced capitalist democracies. American Sociological Review, 68(1), 22–51.CrossRefGoogle Scholar
  36. Nelson, K. (2012). Counteracting material deprivation: The role of social assistance in Europe. Journal of European Social Policy, 22(2), 148–163.CrossRefGoogle Scholar
  37. Nolan, B., Whelan, C. T., & WP2011, G. (2011). The EU 2020 poverty target. In GINI Discussion Paper No. 19.Google Scholar
  38. OECD. (2008). Growing unequal? Income distribution and poverty in OECD countries. Paris: OECD.Google Scholar
  39. OECD. (2011). Divided we stand. Why inequality keeps rising. Paris: OECD Publishing.Google Scholar
  40. Perry, B. (2002). The mismatch between income measures and direct outcome measures of poverty. Social Policy Journal of New Zealand, 19, 101–127.Google Scholar
  41. Raftery, A. E., & Lewis, S. M. (1992). How many iterations in the Gibbs sampler? In J. M. Bernado, J. O. Berfer, A. P. Dawid, & A. F. M. Smith (Eds.), Bayesian Statistics (Vol. 4, pp. 765–776). Oxford: Oxford University Press.Google Scholar
  42. Reinstadler, A., & Ray, J.-C. (2010). Macro Determinants of Individual Income Poverty in 93 Regions of Europe (No. 2010-13). CEPS/INSTEAD.Google Scholar
  43. Saltkjel, T., & Malmberg‐Heimonen, I. (2017). Welfare generosity in Europe: A multi‐level study of material deprivation and income poverty among disadvantaged groups. Social Policy & Administration, 51(7), 1287–1310.CrossRefGoogle Scholar
  44. Shapley, L. S. (1953). A value for n-person games. In H. W. Kuhn & A. W. Tucker (Eds.), Contributions to the theory of games. Annals of mathematical studies (Vol. 28, pp. 307–317). Princeton: Princeton University Press.Google Scholar
  45. Snijders, T. A. B., & Bosker, R. J. (2012). Multilevel analysis: An introduction to basic & advanced modeling (2nd ed.). London: Sage Publishers.Google Scholar
  46. Spiegelhalter, D. J., Best, N. G., Carlin, B. P., & Van Der Linde, A. (2002). Bayesian measures of model complexity and fit. Journal of the Royal Statistical Society: Series B (Statistical Methodology), 64(4), 583–639.CrossRefGoogle Scholar
  47. Stegmueller, D. (2013). How many countries for multilevel modeling? A comparison of frequentist and Bayesian approaches. American Journal of Political Science, 57(3), 748–761.CrossRefGoogle Scholar
  48. Tai, T. O., & Treas, J. (2008). Poverty, household composition, and welfare states: A multi-level analysis of 22 countries (No. 492). Working Paper.Google Scholar
  49. Veall, M. R., & Zimmermann, K. F. (1996). Pseudo-R2 measures for some common limited dependent variable models. Journal of Economic Surveys, 10(3), 241–259.CrossRefGoogle Scholar
  50. Verbist, G., & Matsaganis, M. (2014). The redistributive capacity of services in the European Union. In B. Cantillon & F. Vandenbroucke (Eds.), Reconciling work and poverty reduction: How successful are European welfare states?. Oxford: Oxford University Press.Google Scholar
  51. Visser, M., Gesthuizen, M., & Scheepers, P. (2014). The impact of macro-economic circumstances and social protection expenditure on economic deprivation in 25 European Countries, 2007–2011. Social Indicators Research, 115(3), 1179–1203.CrossRefGoogle Scholar
  52. Whelan, C. T., Layte, R., & Maitre, B. (2003). Persistent income poverty and deprivation in the European Union: An analysis of the first three waves of the European Community Household Panel. Journal of Social Policy, 32(01), 1–18.CrossRefGoogle Scholar
  53. Whelan, C. T., Layte, R., & Maître, B. (2004). Understanding the mismatch between income poverty and deprivation: A dynamic comparative analysis. European Sociological Review, 20, 287–302.CrossRefGoogle Scholar
  54. Whelan, C. T., Layte, R., Maître, B., & Nolan, B. (2001). Income, deprivation, and economic strain. An analysis of the European community household panel. European Sociological Review, 17(4), 357–372.CrossRefGoogle Scholar
  55. Whelan, C. T., & Maître, B. (2006). Comparing poverty and deprivation dynamics: Issues of reliability and validity. The Journal of Economic Inequality, 4(3), 303–323.CrossRefGoogle Scholar
  56. Whelan, C. T., & Maître, B. (2007). Income, deprivation and economic stress in the enlarged European Union. Social Indicators Research, 83(2), 309–329.CrossRefGoogle Scholar
  57. Whelan, C. T., & Maître, B. (2012). Understanding material deprivation: A comparative European analysis. Research in Social Stratification and Mobility, 30(4), 489–503.CrossRefGoogle Scholar
  58. Whelan, C. T., & Maître, B. (2013). Material deprivation, economic stress, and reference groups in Europe: An analysis of EU-SILC 2009. European Sociological Review, 29(6), 1162–1174.CrossRefGoogle Scholar
  59. Wiepking, P., & Maas, I. (2005). Gender differences in poverty: A cross-national study. European Sociological Review, 21(3), 187–200.CrossRefGoogle Scholar
  60. Young, H. P. (1985). Monotonic solutions of cooperative games. International Journal of Game Theory, 14(2), 65–72.CrossRefGoogle Scholar
  61. OECD (2008). Growing Unequal? Income Distribution and Poverty in OECD Countries. Paris, OECD.Google Scholar

Copyright information

© Springer Nature B.V. 2019

Authors and Affiliations

  1. 1.KU LeuvenBrusselsBelgium
  2. 2.Luxembourg Institute of Socio-Economic ResearchEsch-sur-AlzetteLuxemburg

Personalised recommendations