The Journal of Economic Inequality

, Volume 4, Issue 3, pp 303–323 | Cite as

Comparing poverty and deprivation dynamics: Issues of reliability and validity

  • Christopher T. Whelan
  • Bertrand Maître


In this paper we seek to establish if earlier findings relating to the relationship between income poverty persistence and deprivation persistence could be due to a failure to take measurement error into account. To address this question, we apply a model of dynamics incorporating structural and error components. Our analysis shows a general similarity between latent poverty and deprivation dynamics. In both cases we substantially over-estimate the probability of exiting from poverty or deprivation. We observe a striking similarity across dimensions for both observed and latent outcomes. In both cases levels of poverty and deprivation persistence are higher for the latent case. However, there is no evidence that earlier results relating to the differences in the determinants of poverty and deprivation persistence are a consequence of differential patterns of reliability. Taking measurement error into account seems more likely to accentuate rather than diminish the contrasts highlighted by earlier research. Since longitudinal differences relating to poverty and deprivation cannot be accounted for by measurement error, it seems that we must accept that we are confronted with issues relating to validity rather than reliability. Even where we measure these dimensions over reasonable periods of time and allow for measurement error, they continue to tap relatively distinct phenomenon. Thus, if measures of persistent poverty are to constitute an important component of EU social indicators, a strong case can be made for including parallel measures of deprivation persistence and continuing to explore the relationship between them.

Key words

deprivation dynamic latent class analysis measurement error poverty 


Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.


  1. 1.
    Atkinson, A.B., Cantillon, B., Marlier, B. and Nolan, B.: Social Indicators: The European Union and Social Inclusion. Oxford University Press, 2002.Google Scholar
  2. 2.
    Bane, M.J. and Ellwood, D.T.: Slipping in and out of poverty: The dynamics of poverty spells, Journal of Human Resources 12 (1986), 1–23.CrossRefGoogle Scholar
  3. 3.
    Basic, E. and Rendtel, R.: Latent Markov Chain Analysis of Income States with the European Community Household Panel: Empirical results on Measurement Error and attrition Bias, Paper presented at the 2nd International Conference of ECHP Users-EPUNet, Berlin, June 23–26, 2004.Google Scholar
  4. 4.
    Breen, R. and Moisio, P.: Overestimated poverty mobility: Poverty dynamics corrected for measurement error, Journal of Economic Inequality 2(3) (2004), 171–191.CrossRefGoogle Scholar
  5. 5.
    Buhman, B., Rainwater, L., Schmaus, G. and Smeeding, T.: Equivalence scales, well-being, inequality and poverty: Sensitivity estimates across ten countries using the Luxembourg income study database, Review of Income and Wealth 34 (1988), 115–142.CrossRefGoogle Scholar
  6. 6.
    Dewilde, C.: The multidimensional measurement of poverty in Belgium and Britain: A categorical approach, Journal of Social Indicators 68(3) (2004), 331–369.CrossRefGoogle Scholar
  7. 7.
    Duncan, G., Gustaffsin, B., Hauser, R., Schmaus, G., Messinger, H., Mufferls, R., Nolan, B. and Ray, J.: Poverty dynamics in eight countries, Journal of Population Economics 6 (1993), 215–234.CrossRefGoogle Scholar
  8. 8.
    Fouarge, D. and Layte, R.: The duration of spells of poverty in Europe, Journal of Social Policy, 34(3) (2005), 1–20.CrossRefGoogle Scholar
  9. 9.
    Gordon, D.: Measuring Poverty and Social Exclusion in Britain: The Dynamics of Poverty Workshop, Central European University, Budapest, May 24–25, 2002.Google Scholar
  10. 10.
    Jarvis, S. and Jenkins, S.: Low income dynamics in the 1990s in Britain, Fiscal Study 18(2) (1999), 123–142.CrossRefGoogle Scholar
  11. 11.
    Layte, R. and Whelan, C.T.: Moving in and out of poverty, European Societies 5(2) (2003), 167–191.CrossRefGoogle Scholar
  12. 12.
    Leisering, L. and Leibfried, S.: Time and Poverty in Western Welfare States: United Germany in Perspective, Cambridge University Press, Cambridge MA, 1999.Google Scholar
  13. 13.
    Mack, J. and Lansley, S.: Poor Britain, Allen and Unwin, London, 1985.Google Scholar
  14. 14.
    Moisio, P.: Poverty Dynamics According to Direct, Indirect and Subjective Measures. Modelling Markovian Processes in a discrete time and space with error, STAKES Research Report 145, Helsinki (2004).Google Scholar
  15. 15.
    Moisio, P.: A latent class application to the multidimensional measurement of poverty, Quantity and Quality–International Journal of Methodology 38(6) (2005), 703–717.CrossRefGoogle Scholar
  16. 16.
    Muffels, R. and Fouarge, D.: The role of European Welfare States in explaining resources deprivation, Social Indicators Research 68 (2004), 299–330.CrossRefGoogle Scholar
  17. 17.
    Pérez-Mayo, J.: Identifying deprivation profiles in Spain: A new approach, Applied Economics 37 (2005), 843–955.Google Scholar
  18. 18.
    Perry, B.: The mismatch between income measures and direct outcome measures of poverty, Social Policy Journal of New Zealand 19 (2002), 101–127.Google Scholar
  19. 19.
    Rendtel, U., Langeheine, R. and Bernstein, R.: The estimation of poverty dynamics using different household income measures, Review of Income and Wealth 44 (1998), 81–98.CrossRefGoogle Scholar
  20. 20.
    Ringen, S.: The Possibility of Politics, Clarendon, Oxford, 1987.Google Scholar
  21. 21.
    Ringen, S.: Direct and indirect measures of poverty, Journal of Social Policy 17 (1988), 351–366.CrossRefGoogle Scholar
  22. 22.
    Vermunt, J.K., LEM: A General Programme for the Analysis of Categorical Data, Tilburg University, 1997.Google Scholar
  23. 23.
    Watson, D. and Healy, M.: Sample Attrition Between Waves 1 And 2 in the European Community Household Panel, European Commission, Luxembourg, (1999) 118/99.Google Scholar
  24. 24.
    Watson, D.: Sample attrition between wave 1 and 5 in the European Community Household Panel, European Sociological Review 19(4) (2003), 361–378.CrossRefGoogle Scholar
  25. 25.
    Whelan, C.T., Layte, R., Maître, B. and Nolan, B.: 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(1) (2003), 1–32.CrossRefGoogle Scholar
  26. 26.
    Whelan, C.T., Layte, R., Nolan, B. and Maître, B.: Income, deprivation and economic strain: An analysis of the European Community Household Panel, European Sociological Review 17(4) (2001), 357–372.CrossRefGoogle Scholar
  27. 27.
    Whelan, C.T, Layte, R. and Maître, B.: Understanding the mismatch between income poverty and deprivation: A dynamic comparative analysis, European Sociological Review 20(4) (2004), 287–301.CrossRefGoogle Scholar
  28. 28.
    Wirz, C. and Mejer, L.: The European Community Household Panel (ECHP), Schmollers Jahburch (Journal of Applied Social Studies) 112(1) (2002), 43–54.Google Scholar

Copyright information

© Springer Science+Business Media, Inc. 2006

Authors and Affiliations

  1. 1.Economic and Social Research InstituteDublin 4Ireland

Personalised recommendations