Poor Children in Europe.Poor Children in Europe.An Analytical Approach to the An Analytical Approach to the Study of Child Poverty, in the Study of Child Poverty, in the European Union, Between 1994 European Union, Between 1994 and 2000and 2000
Supervisors
Gian Lorenzo Venturini
Prof. Jos Berghman
Katholieke Universiteit Leuven
PhD program in Social Sciences
Prof. Chiara Saraceno
Università degli studi di Torino
PhD program in Comparative Social Research
Structure of the Presentation
I. The need for an analytical approach
II. The general features of the research design
III. Accounting for the situational mechanism
IV. Accounting for the action-formation mechanism
V. Summary of the findings
1. The cognitive question
Mt+
1
Mt
Child poverty at time t
Child poverty at time t+1
Intensity
Incidence
presistence
Child poverty in Europe between 1994 and 2000
2. An Epistemological and Empirical Empasse
When we deal with such issues we have to fight against two When we deal with such issues we have to fight against two ISMsISMs
Micro-riductionism
Structuralism
Micro
Macro
«Paradigm of structure»
Micro
Macro
«Paradigm of action»
Mac
ro
an empasse…
Mac
ro &
micr
o
Analytical level
The level of the issue that I aim to explain
Theoretical level
The heuristic potential of the theoretical system I aim to apply
Wippler and Lindenberg (1987)
We need multilevel theories of child povertyWe need multilevel theories of child poverty
3. Multilevel theories of child poverty
4. A Solution to the Dilemma: The Coleman’s Boat
mm
tt
mmt+t+
11
MMtt MMt+1t+1
The situational mechanism
The transformational
mechanism
The action-formation
mechanism
The situational mechanismThe situational mechanismIt refers to the fact that actors live in a specific social situation that, to some extent, affects them and the environment in which they live
The transformational mechanismThe transformational mechanismIt depicts how the actions of different actors collide with one another and generate collective macro outcomes
The action–formation mechanismThe action–formation mechanism It considers the way in which individuals’ actions take a form
5. Coleman’s Boat Implementation
Cognitive aims Implementation strategies
Description of the macro environment in which individuals live (the situational mechanism)
Analysis of theories on welfare regimes Reconstruction of the main social policy schemes Estimation of macro indicator national wealth,
income inequalities, social protection expenditures and income poverty and material deprivation
A micro model to account for poverty risks at a micro level
Operazionalization of the concept of poverty and endowment
Estimation of the impact of parents/households’ endowment on the probability for a child to be poor, via a random-effect logistic model
Merging the micro and the macro findings Discussion of the main findings
6. The General Features of the Research Design
Germany
Denmark
Belgium
France
UK
Italy
Spain
«Data»
The first ECHP seven waves (1994-2000)
Literature
EUROSTAT
Cross-country comparison
Multiple case study based on holistic cases (Yin, 2003)
«Replication logic» as opposed to the «sampling logic» (see Yin, 2003, p.45)
7. Other Theoretical and Methodological Issues
1. The operazionalization of the concept of poverty (see Ravallion, 1992)
i) How do we assess individual well-being? Household’s equivalized disposable income
ii) At what level of well-being we can say that a person is not poor?60% of the median of the equivalized income distribution
iii) How do we aggregate individual indicators of well-being into a measure of poverty?Headcount ratio (poverty incidence)
Average poverty gap ratio (poverty intensity)
2. A model of the social actor
The D-B-O model (see Elster 1993)
Contributions to describe the «situational mechanism»
Theories
Policy analysis
Data
Structure of intra-household care giving obligations and family policies
Pathways of interaction among Family-State-Market
Policy strengthening prevention and children’s well-being
Policy Reducing households’ expenses
Bring people into work that pays;Improving living standard through direct cash transfer.
Policy increasing households’ resources
8. The Description of the Situational Mechanism (MACRO)
Trends in national wealth, income inequalities and social protection
expenditure
Trends in child poverty
Trends in household poverty
Household poverty
incidence
Household poverty rates
Household poverty intensity
Average household
poverty gap ratio
Child poverty duration
Child poverty incidence
Data
Child poverty rates
Child poverty incidence reduction after social transfers
Child poverty intensity
Average child poverty gap ratio
Child poverty intensity reduction after transfers
First child poverty spell duration (Survival Analysis)
Proportion of children experiencing a second poverty spell
Child deprivation
Incidence of deprivation
First deprivation spell duration (Survival analysis)
GDP per capita, in PPSIncome share of the 10th decileSocial protection expenditure as a proportion of GDPSocial protection expenditure, per capita, in PPSDetailed social protection expenditure, per capita, in PPSSocial benefits expenditures by type, per capita, in PPSSocial benefits expenditures by function, per capita, in PPSDegree of heterogeneity of the pattern of social protection expenditure
0%
5%
10%
15%
20%
25%
30%
35%
1994 1995 1996 1997 1998 1999 2000
De Dk Be Fr UK It Es
Continental cluster: is split up into two parts
Dk, It: stableBe, De: decreasingUK: steepest reductionFr, Es: increasing
9. The Macro data: Child Poverty Incidence
•De, Be are sliding north and coming closer to Denmark;
•Fr is sliding south and moving nearer to Spain, Italy and the UK
0
2
4
6
8
10
12
1994 1995 1996 1997 1998 1999 2000
De Dk Be Fr UK It Es
9. The Macro Data: Child Poverty Intensity
Dk, Fr, It, Es: stable
Be, De, UK: decreasing
00 ,10 ,20 ,30 ,40 ,5
0 ,60 ,70 ,80 ,9
1
0 1 2 3 4 5 6 7
D e D k B e F r U K I t E s
D k D e B e F r U K I t E s 2 5 t h p e r c e n t i l e 1 1 1 1 1 1 1
M e d ia n 1 2 2 3 3 3 3
χ 2 = 3 3 .0 0 ( 6 d e g r e e s o f f r e e d o m ) L o g - r a n k te s t
P > χ 2 = 0 .0 0 0 0
9. The macro data: child poverty presistence
Dk: low
Be, De: medium
Fr, It, Es, UK: high
0
0,1
0,2
0,3
0,4
0,5
0,6
0,7
1 2 3 4 5 6 7
Dk Be Fr It Es
Dk Be Fr It Es 25 th percentile 1 1 1 1 1 M edian 2 1 2 2 2 75 th percentile - 4 5 6 4
χ2= 23.98 (4 degrees of freedom) Log-rank test
P> χ2= 0.000
See: current life-style deprivation (Whelan and Maître 2004)
9. The macro data: child presistence in deprivation
Dk: low
Be, Es: medium
Fr, It: high
SR Oi's endowment
SR OBlack-box
The individuals’ endowment
Set of material and immaterial resources transmitted by the macro environment in which i lives (see the situational mechanism), accumulated or wasted by i in the past (see i’s foregoing actions), made available as well as unavailable by other individuals’ action (see j…n’s actions) and mediated by the individual’s desires and beliefs.
The parents’ endowment
Set of material and immaterial resources parents can resort to, to prevent the risk of poverty for their dependent children
The Concept of Endowment
10. A Micro Model to Account for the Action-Formation Mechanism
Parents’ endowmentParents’ endowmentmicromicro
Child poverty risksChild poverty risks
Child poverty outcomesChild poverty outcomes
Ex-post intervention
«Re-equalizing»
Situational mechanismSituational mechanismMacroMacro
Family and MarketFamily and Market
Situational mechanismSituational mechanismMacroMacro
State, welfare regimeState, welfare regime
Ex-ante intervention
«Empowering»
The higher the «correlation» between parents endowment The higher the «correlation» between parents endowment and child poverty outcomes, the higher the level of and child poverty outcomes, the higher the level of
inequalitiesinequalities
Status on poverty at time t
Mother’s highest level of education completed
Father’s highest level of
education completed
Household’s educational endowment
Mother’s position of the labour
market
Father’s position of the labour
market
Household’s occupational endowment
Household’s
demographic
endowment
Number of dependent children
Parents’ citizenship
Parents’ age
Household’s
health endowme
nt
Mother’s
health status
Father’s health status
Children’ age
Children’ sex
Household’s economic endowment
Mother’s main source of income
Father’s main source of income
11. The Operationalization of the Concept of Endowment
Number of dependent children Three or more Two One
Father’s/mother’s citizenship Non-national National
Father’s and mother’s age Child’s age
Socio-demographic endowment
Child’s sex Father’s/mother’s occupational status
Not working Working part-time
Occupational endowment
Working full-time Father’s/mother’s main source of income
Social transfers or private income Economic endowment Income from work
Father’s/mother’s level of education Recognised third level education (ISCED 5-7) Second stage of secondary level education (ISCED 3)
Educational endowment
Less than second stage of secondary education Father/mother health status
Individual has a chronic physical or mental health problem Health endowment Individual has no chronic physical or mental health problem
12. The Micro Model: general features
3. Modelling Panel Data
Random-effect logistic model
4. Unit of AnalysisChildren, younger than 15 y.o., living with a parental couple
Since the explanandum is operationalized as a dummy variable, I opted for the logistic regression
1. The statistical tool
2. Modelling Cross-country Comparison
Country is treated as a stratification variable. Therefore the same model has been estimated over 7 different samples (one for each country) and odds-ratio are compared.
5. Controlling factorsFather’s and mother’s age
Child’s age and sex
Father’s and mother’s citizenship (national/non national)
Father’s and mother’s health status
Unobserved heterogeneity (see random-effect model)
13. The Micro Model: Controlling factors and reference categories
Let us define this as the baseline - the theoretically most protective endowment
Reference categories in the random-effect logistic regression
Household’s demographic endowment One dependent child
Household’s economic endowment Father’s main source of income: income from
workMother’s main source of income: income from work
Household’s occupational endowment
Father: full-time workerMother: full-time worker
Household’s educational endowmentFather’s highest level of education completed: high (recognised III level education)Mother’s level of education: high (recognised III level education)
Let us observe the odds ratios
Are child poverty risks endowment-dependent?Are child poverty risks endowment-dependent?
14. Testing the hypothesis: endowment dependency of child poverty risks
A. Significantly higher than 1Child poverty risks are endowment dependent:the weaker the endowment the higher the risks
B. No significant differences Child poverty risks are not endowment dependent
Dk Be De Fr UK Es It
Three or more dependent children 1,96* 1,12 3,59** 1,49* 10,70** 5,38** 3,55*
Two dependent children 1,25 1,95* 1,55* 1,27 1,45 1,75** 1,45*
Father’s main source of income: social transfers or private income
12,67** 39,77** 23,51** 11,98** 8,25** 14,28** 4,97*
Mother’s main source of income: social transfers or private income
5,58** 3,02** 3,72** 5,78** 4,48** 3,99** 3,48*
Father not working 0,56 1,27 3,20** 2,11** 12,38** 2,53** 2,62**
Father working part-time 0,32 0,22 1,41 3,58 10,40** 4,02** 4,85**
Mother not working 0,58 3,27** 1,33 2,64** 5,55** 1,26 2,53**
Mother working part-time 0,77 2,62* 2,35** 7,54** 2,08* 2,54** 0,27**
Mother’s level of education: low 1,51 1,33 2,20* 3,70** 1,70* 4,27** 7,19**
Father’s level of education: medium
1,73 2,14** 4,75** 4,37** 0,97 2,00** 2,96**
Mother’s level of education: medium
1,35 1,58 2,17** 2,93** 0,99 1,24 2,08*
Father’s level of education: low 1,04 2,91** 8,33** 10,25** 4,17** 6,71** 8,70**
Random-effect logistic regression, odds ratios
* Significant for p<0,05** Significant for p<0,01
LowLow MediumMedium HighHigh
Predicted probability to be a
poor child (Average values)
Dk 21,2% Be 79,7%
De, It, Fr 87,5% - 89,1%
UK, Es 99,8% - 96,6%
Children with at least two siblings, whose parents:
•are not working•have social transfers or private income as their main
source of income •have low educative credentials•suffer of a physical or mental disability
LowLow
MediumMedium
HighHigh
15. Summary of the Findings: Denmark, the Benchmark
• The lowest levels of child poverty incidence, intensity and presistence
• The lowest level of child deprivation incidence and presistence
• Child poverty risks depend on parents’ endowment to a very low extent
• The highest per capita GDP
• One of the highest per capita GDP growth rate (in PPS)
• The highest level of social protection expenditure (as a proportion of GDP and in PPS per capita)
At the micro level
At the macro level
• The lowest level of income inequalities
Re-equalizing effectRe-equalizing effect
A comparatively higher capacity of the macro A comparatively higher capacity of the macro welfare-triangle to counteract endowment welfare-triangle to counteract endowment
inequalities causes child poverty risks to be lowinequalities causes child poverty risks to be low
At the macro level
16. Summary of the Findings: Germany, Belgium and France, the Halfway Position with a Northern/Southern Shift
• The overall economic wealth appears to be more equally distributed among the population than in Italy and Spain
• Income inequalities faced a small decline in France and they kept stable in Germany
• Higher levels of social protection expenditure than in Italy and Spain, that succeeded in alleviating child poverty incidence and intensity to a progressively higher extent
• Child poverty incidence has been generally stable or decreasing in Belgium and Germany, but increasing in France
• Level of per capita GDP in PPS and GDP average growth rate lower than in Denmark and similar to Italy and Spain.
• Child poverty presistence is higher in France than in Belgium and Germany
• Child deprivation is higher in France than in Belgium
At the micro level• Child poverty risks are less dependent on parents’ endowment in Belgium
than in Germany and France
Halfway position. Yet the cluster is splitting up: Halfway position. Yet the cluster is splitting up: Belgium, and to some extent Germany, Belgium, and to some extent Germany, sliding sliding
north,north, while France while France sliding southsliding south
17. Summary of the Findings: The UK, a country in transition
Issue Changes between 1998 and 2003 Child benefit Benefit increased twice as much as the inflation rate
Complement for first child increased by 40% Complement for lone parent families is eliminated
Family credit Eliminated Income support/ JSA Child complement eliminated Child tax credit Means-tested benefit for families with children
Amount is the sum of a fixed rate per family (family element) and a fixed rate per child (child element) Each element is tapered at different income thresholds and with different withdrawal rates
Working tax credit Means-tested in-work benefit Hours condition for parents is lower The basic amount is higher for lone parents and couples with or without children Families with children where all parents work are entitled to a refund for childcare costs
Housing benefit and Council tax benefit
Updated above the inflation rate The complement is the same for all children’s ages Complement for lone parents is eliminated
Additions to some insurance benefits
Child additions eliminated
Changes at the policy level, during the 1998-2003 period (See Levy, Lietz, Sutherland, 2005)
• The second higher average annual increase of per capita GDP in PPS
• Small increase of income inequalities
• UK shares the features of the southern European countries: high levels of child poverty incidence and intensity; one of the highest degrees of child poverty presistence (both in terms of the first observed child poverty spell duration and chances for the children to fall back into poverty)
At the macro level
At the micro level
•Child poverty risks are still endowment dependent
• Low level of social protection expenditures (as a % of GDP and in PPS per capita), but the highest average annual increase of per capita expenditure in PPS
•Yet: child poverty incidence and intensity has been clearly declining
Such transformations are likely not to be fully Such transformations are likely not to be fully reflected in the micro data at our disposal. A time reflected in the micro data at our disposal. A time
lag is likely to exist between the point in time when lag is likely to exist between the point in time when a change at the macro level takes place and the a change at the macro level takes place and the moment when it is perceived at the micro levelmoment when it is perceived at the micro level
Mismatch between changes at the policy level, Mismatch between changes at the policy level, poverty outcomes and endowment effect estimated poverty outcomes and endowment effect estimated
on the ECHP (1994-2000)on the ECHP (1994-2000)
18. Summary of the Findings: Italy and Spain, the intergenerational transmission of poverty
•The lowest per capita GDPItaly: the lowest average annual GDP growth rateSpain: the highest average annual GDP growth rate
•By far, the lowest level of social protection expenditure Decreasing, in terms of GDP Increasing, but less than in the other countries, in term of PPP
per capita. •The most polarized pattern of social transfer provision (the
overwhelming majority going to pensions and public health care)
•Low levels of employment rates, especially among females
At the macro level
•Higher rates of long-term unemployment
•Lower effectiveness of the social transfer in reducing moderate and extreme child poverty, both in terms of incidence and intensity
•The highest level of income inequalities
At the micro level
• Poverty risks for households with very weak endowments are far higher than in the other countries
• Child poverty risks strongly depend on the configuration of the parents endowment
Deprivation experienced Deprivation experienced during childhood interferes during childhood interferes with the process of with the process of construction of protective construction of protective endowmentsendowments
Child poverty incidence, Child poverty incidence, intensity and presistence is intensity and presistence is much higher in Italy and much higher in Italy and SpainSpain
In Italy and Spain, child In Italy and Spain, child poverty risks are strongly poverty risks are strongly endowment-dependentendowment-dependent
Intergenerational Intergenerational transmission of transmission of
povertypoverty
19. Limits of the study
Difficulties in investigating both the macro and the micro Difficulties in investigating both the macro and the micro level deeplylevel deeply
Difficulties in merging the macro and micro findings into a Difficulties in merging the macro and micro findings into a multilevel theorymultilevel theory
I disregarded the transformational mechanismI disregarded the transformational mechanism
A great deal of attention to A great deal of attention to describingdescribing; far less attention to ; far less attention to explainingexplaining