Assessing poverty persistence in households with dependent children: the role of poverty measurement

The burden of poverty in Italy is unevenly distributed among various household types; in particular, those with dependent children are characterized by much higher incidences rates. As a consequence Italian children are more likely to experience poverty with respect to the general population, hindering their effective inclusion in the Italian society. This paper analyses the determinants of the risk of poverty and severe material deprivation for households with dependent children in Italy for the period 2010-2013. The analysis is based on the EU-SILC survey. We consider three indicators: the at risk-of-poverty, the subjective poverty, and the severe material deprivation rates. We apply a dynamic random effects probit model with autocorrelated error separately to the analysis of each indicator to assess genuine state dependence after controlling for various structural characteristics of the households. A strong state dependence emerges, regardless of the considered poverty measure thus providing evidence of poverty persistence or poverty trap. We also find that household work intensity is fundamental to prevent household to fall into poverty and material deprivation.