IDEAS home Printed from https://ideas.repec.org/a/bla/ecorec/v82y2006i258p341-364.html
   My bibliography  Save this article

Monitoring Trends in Poverty and Income Distribution: Data, Methodology and Measurement

Author

Listed:
  • PETER SAUNDERS
  • BRUCE BRADBURY

Abstract

Australian research on poverty and income distribution has been subject to criticism over definitional, data quality and measurement issues that have undermined its validity and impact. In reviewing these issues, this paper addresses some of the problems that have been identified in the literature and illustrates their importance with examples that shed light on the validity of the arguments. It also seeks to establish whether poverty has increased or decreased in the decade to 2002–03 and examines the overlap between hardship or deprivation and income poverty, and reviews some of the emerging evidence on the dynamics of low income. After a detailed review of data problems, the significance of definitional issues is illustrated in relation to the measurement of income inequality and poverty. Attention then focuses on assessing the sensitivity of estimated trends in income poverty to how poverty is defined and measured. Although there is variation across the different measures, the evidence suggests that progress in reducing relative poverty has been slow. Our preferred measure (based on current income) suggests that relative poverty increased slightly over the decade, with most of the increase occurring between 1995–96 and 1999–2000. When poverty is measured in ‘absolute’ terms using a poverty line that is held constant in real terms, the poverty rate declined overall, but was more or less constant between 1996–97 and 2000–01. Estimates derived from wave III of Household Income and Labour Dynamics in Australia (HILDA) data indicate that those who were income poor in 2002–03 experienced twice as many hardship conditions as those who were not poor, with around one‐quarter of the poor having problems paying bills or seeking external financial assistance. HILDA data also indicate that many of those who are in poverty in any single year manage to escape within the next 2 years, although it is too early to know whether they escape permanently, or slip back into poverty or oscillate on its margins.

Suggested Citation

  • Peter Saunders & Bruce Bradbury, 2006. "Monitoring Trends in Poverty and Income Distribution: Data, Methodology and Measurement," The Economic Record, The Economic Society of Australia, vol. 82(258), pages 341-364, September.
    • Handle: RePEc:bla:ecorec:v:82:y:2006:i:258:p:341-364
    DOI: 10.1111/j.1475-4932.2006.00344.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1475-4932.2006.00344.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1475-4932.2006.00344.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. John Micklewright, 2003. "Child Poverty in English-Speaking Countries," Papers inwopa03/25, Innocenti Working Papers, revised 2003.
    2. Ann Harding & Aggie Szukalska, 2000. "Trends in Child Poverty in Australia, 1982 to 1995–96," The Economic Record, The Economic Society of Australia, vol. 76(234), pages 236-254, September.
    3. Andrzej Grodner & Timothy Smeeding, 2000. "Changing Income Inequality in OECD Countries: Updated Results from the Luxembourg Income Study (LIS)," LIS Working papers 252, LIS Cross-National Data Center in Luxembourg.
    4. Paul Blacklow & Ranjan Ray, 2000. "A Comparison of Income and Expenditure Inequality Estimates: The Australian Evidence, 1975–76 to 1993–94," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 33(4), pages 317-329, December.
    5. Nicole Watson & Mark Wooden, 2004. "Sample Attrition in the HILDA Survey," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 7(2), pages 293-308, June.
    6. Peter Saunders, 2004. "Examining Recent Changes in Income Distribution in Australia," The Economic and Labour Relations Review, , vol. 15(1), pages 51-73, June.
    7. Nolan, Brian & Whelan, Christopher T., 1996. "Resources, Deprivation, and Poverty," OUP Catalogue, Oxford University Press, number 9780198287858.
    8. Annie Abello & Ann Harding, 2006. "Income Mobility and Financial Disadvantage: Australian Children," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 13(1), pages 31-48.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Herwig Immervoll & Horacio Levy & Christine Lietz & Daniela Mantovani & Cathal O’Donoghue & Holly Sutherland & Gerlinde Verbist, 2006. "Household Incomes and Redistribution in the European Union: Quantifying the Equalizing Properties of Taxes and Benefits," Palgrave Macmillan Books, in: Dimitri B. Papadimitriou (ed.), The Distributional Effects of Government Spending and Taxation, chapter 5, pages 135-165, Palgrave Macmillan.
    2. Borooah, Vani, 2007. "Measuring economic inequality: deprivation, economising and possessing," MPRA Paper 19422, University Library of Munich, Germany.
    3. Richard Layte & Brian Nolan & Christopher T. Whelan, 2001. "Reassessing Income and Deprivation Approaches to the Measurement of Poverty in the Republic of Ireland," The Economic and Social Review, Economic and Social Studies, vol. 32(3), pages 239-261.
    4. M. Sirgy, 2011. "Theoretical Perspectives Guiding QOL Indicator Projects," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 103(1), pages 1-22, August.
    5. Tania Burchardt & Julian Le Grand, 2002. "Constraint and Opportunity: Identifying Voluntary Non-Employment," CASE Papers case55, Centre for Analysis of Social Exclusion, LSE.
    6. Xavier Ramos, 2008. "Using Efficiency Analysis to Measure Individual Well-being with an Illustration for Catalonia," Palgrave Macmillan Books, in: Nanak Kakwani & Jacques Silber (ed.), Quantitative Approaches to Multidimensional Poverty Measurement, chapter 9, pages 155-175, Palgrave Macmillan.
    7. Marina Vercelli & Roberto Lillini & Fabrizio Stracci & Valerio Brunori & Alessio Gili & Fortunato Bianconi & Francesco La Rosa & Alberto Izzotti & Elodie Guillaume & Guy Launoy, 2020. "Cancer Mortality and Deprivation: Comparison Among the Performances of the European Deprivation Index, the Italian Deprivation Index and Local Socio-Health Deprivation Indices," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 151(2), pages 599-620, September.
    8. Christopher Whelan & Bertrand Maitre, 2010. "Poverty in Ireland in Comparative European Perspective," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 95(1), pages 91-110, January.
    9. Jesus Perez-Mayo, 2005. "Identifying deprivation profiles in Spain: a new approach," Applied Economics, Taylor & Francis Journals, vol. 37(8), pages 943-955.
    10. Timothy Smeeding, 2005. "Government Programs and Social Outcomes: The United States in Comparative Perspective," LIS Working papers 426, LIS Cross-National Data Center in Luxembourg.
    11. Hesse, Klaus & Hoffmann, Claudia & Thiele, Silke, 2002. "Änderungen der Struktur der Nachfrage nach Nahrungs-und Genußmitteln privater Haushalte und deren Bedeutung für die Ernährungs- und Agrarwirtschaft Schleswig-Holsteins," FE Working Papers 0302, Christian-Albrechts-University of Kiel, Department of Food Economics and Consumption Studies.
    12. Maitre, Bertrand & Nolan, Brian & Whelan, Christopher T., 2006. "Reconfiguring the Measurement of Deprivation and Consistent Poverty in Ireland," Research Series, Economic and Social Research Institute (ESRI), number PRS58.
    13. Koen Caminada & Kees Goudswaard & Chen Wang & Jinxian Wang, 2019. "Income Inequality and Fiscal Redistribution in 31 Countries After the Crisis," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 61(1), pages 119-148, March.
    14. Brian Nolan & Christopher T. Whelan, 1999. "Poverty In Ireland: The Role of Underclass Processes. Published as 'Urban Housing and the Role of Underclass Processes: the Case of Ireland?, Journal of European Social Policy, 2000 Vol 10 No 1," Papers WP115, Economic and Social Research Institute (ESRI).
    15. Peter Saunders & Kuriko Watanabe & Melissa Wong, 2015. "Poverty and Housing Among Older People: Comparing Australia and Japan," Poverty & Public Policy, John Wiley & Sons, vol. 7(3), pages 223-239, September.
    16. Callan, Tim & Nolan, Brian & Walsh, John R. & Whelan, Christopher T. & Maitre, Bertrand, 2008. "Tackling Low Income and Deprivation: Developing Effective Policies," Research Series, Economic and Social Research Institute (ESRI), number RS1.
    17. Bastos, Amélia & Casaca, Sara F. & Nunes, Francisco & Pereirinha, José, 2009. "Women and poverty: A gender-sensitive approach," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(5), pages 764-778, October.
    18. Maite Blázquez Cuesta & Elena Cottini & Herrarte, A. (Ainhoa), 2012. "GINI DP 39: Socioeconomic Gradient in Health: How Important is Material Deprivation?," GINI Discussion Papers 39, AIAS, Amsterdam Institute for Advanced Labour Studies.
    19. Fotis Papadopoulos & Panos Tsakloglou, 2015. "Chronic material deprivation and long-term poverty in Europe in the pre-crisis period," ImPRovE Working Papers 15/16, Herman Deleeck Centre for Social Policy, University of Antwerp.
    20. Corak, Miles, 2005. "Principles and Practicalities for Measuring Child Poverty in the Rich Countries," IZA Discussion Papers 1579, Institute of Labor Economics (IZA).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:ecorec:v:82:y:2006:i:258:p:341-364. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/esausea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.