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Estimating Poverty Persistence in Britain

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  • Francesco Devicienti

Abstract

This paper uses longitudinal data from the BHPS, waves 1-8, to document low-income dynamics and persistence for individuals living in Britain in the 1990s. Poverty exit and re-entry rates are estimated and the resulting distribution of time spent in poverty is calculated, both in single and in multiple-spells frameworks. Poverty persistence predictions are also produced for various subgroups of the populations. To do this, I estimate a multiple-spell model of transitions in and out of poverty, controlling for observed and correlated unobserved individual heterogeneity and for a potential initial condition problem. Components-of-variance models are also used to predict the number of years in poverty for the targeted groups. The two sets of predictions are then compared.

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Bibliographic Info

Paper provided by LABORatorio R. Revelli, Centre for Employment Studies in its series LABORatorio R. Revelli Working Papers Series with number 1.

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Length: 48 pages
Date of creation: 2001
Date of revision:
Handle: RePEc:cca:wplabo:1

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Keywords: poverty persistence; hazard models; multiple spells; unobserved heterogeneity; variance-components models;

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References

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  1. Devicienti, Francesco, 2002. "Estimating Poverty Persistence in Britain," Royal Economic Society Annual Conference 2002, Royal Economic Society 61, Royal Economic Society.
  2. Fertig, Michael & Tamm, Marcus, 2007. "Always poor or never poor and nothing in between? Duration of child poverty in Germany," Technical Reports 2007,05, Technische Universität Dortmund, Sonderforschungsbereich 475: Komplexitätsreduktion in multivariaten Datenstrukturen.
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