Abstract
This chapter investigates the characteristics of chronic poverty among youth in Southern European countries. These countries have the highest levels of poverty in Europe and welfare systems unable to smooth social inequalities effectively. The main aim of this chapter is to investigate on how long-lasting poor among the Mediterranean youth differs in socio-demographic and economic characteristics. The intensity of poverty over time is measured by a very recent longitudinal poverty index based on the rationale of cumulative hardship. We tested the effects of many covariates on the incidence and intensity of chronic poverty, controlling for main socio-demographic and economic characteristics, using a ZINB model. The peculiar mix between the lack of effective state institutions and a strong presence of families explains why many factors, which usually are significantly related to poverty, do not have an important role here. A strong inertial effect is due to the intensity of poverty at the start of the time-window. Italian youth has the worst performance.
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Notes
- 1.
A drawback of these two categories of models is that they usually do not take into account that there is a strong correlation among multiple spells of poverty or non-poverty for the same individual. In particular, in transition models, spells in the two alternating states (poverty and non-poverty) for the same individual are also assumed to be uncorrelated […] However, when individuals differ in unobserved terms like ability, effort, tastes, and these unobservables remain constant over the individual’s lifetime, the assumption of uncorrelated spells might be inappropriate [8].
- 2.
- 3.
Note that here, we use rounded values of the PPI. In particular, we multiplied the PPI by 1,000 and then rounded to the nearest integer. This transformation allows us to keep 30 different values also in the transformed values. Indeed in presence of a longer panel a more appropriate model would be a mixture model allowing zero-inflation and a suitable model for asymmetric data (looking at the distribution observed a reasonable model seems to be the Beta distribution with parameters lower than 1).
- 4.
In our case part of the inflation of zeroes is due to the fact that the PPI is zero also for individuals with a single spell of poverty. Indeed people who are poor only once in the 6 years of observation are 11.7% of our sample. The likelihood ratio test and the Vuong test confirm the appropriateness of the chosen functional form compared to a standard negative binomial distribution.
- 5.
Please note that the classification of the activity status is made through three categories, mutually exclusive, derived from the shrinking of the main activity declared by respondents. So a young individual is a “worker” if she is employed for at least 15 h a week, or a “student”/“unemployed or out of the labour force” even if doing a small/odd paid job but for less than 15 h per week.
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Acknowledgements
Although this chapter is the result of the joint effort of both authors, who share the full responsibility for the content, Sects. 31.1, 31.2, and 31.3 are attributable to D. Mendola, while Sects. 31.4 and 31.5 to A. Busetta. The authors gratefully acknowledge the financial support provided by University of Palermo [grant no. 1267929730 - CORI] under the responsibility of professor A.M. Milito, and IRISS at CEPS/INSTEAD for providing the ECHP data under the FP6 (Trans-national Access contract RITA 026040).
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Mendola, D., Busetta, A. (2013). Chronic Poverty in European Mediterranean Countries. In: Torelli, N., Pesarin, F., Bar-Hen, A. (eds) Advances in Theoretical and Applied Statistics. Studies in Theoretical and Applied Statistics(). Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-35588-2_31
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