Understanding the drivers of low income transitions in Luxembourg
AbstractWe analyse the determinants of poverty transitions, defined as movements across a low income threshold, in Luxembourg. Data used are those from the Luxembourg socioeconomic panel ?Liewen zu Lëtzebuerg? (PSELL3) running from 2003 to 2009. Using an endogenous switching first-order Markov model, we control for potential endogeneity to low income transitions due to both initial condition and non random attrition. We find that employment protects from both remaining poor and entering poverty. In addition, attrition and initial low income are found to be endogenous processes with respect to low income transitions. Finally, genuine state dependence accounts for a substantial level of aggregate state dependence.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by CEPS/INSTEAD in its series CEPS/INSTEAD Working Paper Series with number 2012-31.
Length: 40 pages
Date of creation: Jul 2012
Date of revision:
Contact details of provider:
Postal: 3, avenue de la Fonte, L-4364 Esch-sur-Alzette, G.-D. Luxembourg
Phone: 00352 / 58 58 55 - 1
Fax: 00352 / 58 58 55 - 700
Web page: http://www.ceps.lu
More information through EDIRC
poverty dynamics; Luxembourg; Markov transitions models; attrition; initial conditions; state dependence;
Find related papers by JEL classification:
- I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-08-23 (All new papers)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Atkinson, Tony & Cantillon, Bea & Marlier, Eric & Nolan, Brian, 2002. "Social Indicators: The EU and Social Inclusion," OUP Catalogue, Oxford University Press, number 9780199253494, September.
- Lorenzo Cappellari & Stephen P. Jemkins, 2002. "Who Stays Poor? Who Becomes Poor? Evidence from the British Household Panel Survey," Economic Journal, Royal Economic Society, vol. 112(478), pages C60-C67, March.
- Arnstein Aassve & Simon Burgess & Matt Dickson & Carol Propper, 2006.
"Modelling poverty by not modelling poverty: an application of a simultaneous hazards approach to the UK,"
LSE Research Online Documents on Economics
6243, London School of Economics and Political Science, LSE Library.
- Arnstein Aassve & Simon Burgess & Matt Dickson & Carol Propper, 2006. "Modelling poverty by not modelling poverty: An application of a simultaneous hazards approach to the UK," CASE Papers case106, Centre for Analysis of Social Exclusion, LSE.
- Arnstein Aassve & Simon Burgess & Matt Dickson & Carol Propper, 2005. "Modelling Poverty by not Modelling Poverty: An Application of a Simultaneous Hazards Approach to the UK," The Centre for Market and Public Organisation 05/134, Department of Economics, University of Bristol, UK.
- repec:ese:iserwp:2002-08 is not listed on IDEAS
- Francesco Devicienti, 2001.
"Estimating Poverty Persistence in Britain,"
10th International Conference on Panel Data, Berlin, July 5-6, 2002
B2-3, International Conferences on Panel Data.
- Devicienti, Francesco, 2002. "Estimating Poverty Persistence in Britain," Royal Economic Society Annual Conference 2002 61, Royal Economic Society.
- Francesco Devicienti, 2001. "Estimating Poverty Persistence in Britain," LABORatorio R. Revelli Working Papers Series 1, LABORatorio R. Revelli, Centre for Employment Studies.
- Simon Burgess & Carol Propper, 1998.
"An economic model of household income dynamics, with an application to poverty dynamics among American women,"
LSE Research Online Documents on Economics
6525, London School of Economics and Political Science, LSE Library.
- Simon Burgess & Carol Propper, 1998. "An Economic Model of Household Income Dynamics, with an Application to Poverty Dynamics among American Women," CASE Papers case09, Centre for Analysis of Social Exclusion, LSE.
- Burgess, Simon & Propper, Carol, 1998. "An Economic Model of Household Income Dynamics, with an Application to Poverty Dynamics among American Women," CEPR Discussion Papers 1830, C.E.P.R. Discussion Papers.
- Lorenzo Cappellari & Stephen P. Jenkins, 2002.
"Modelling Low Income Transitions,"
Discussion Papers of DIW Berlin
288, DIW Berlin, German Institute for Economic Research.
- FAYE Ousmane & ISLAM Nizamul & ZULU Eliya, 2011. "Poverty dynamics in Nairobi's slums: testing for true state dependence and heterogeneity effects," CEPS/INSTEAD Working Paper Series 2011-56, CEPS/INSTEAD.
- Ambra Poggi, 2007.
"Does persistence of social exclusion exist in Spain?,"
Journal of Economic Inequality,
Springer, vol. 5(1), pages 53-72, April.
- Ambra Poggi, 2003. "Does persistence of social exclusion exist in Spain?," Working Papers wpdea0308, Department of Applied Economics at Universitat Autonoma of Barcelona.
- Simon Burgess & Carol Propper & Matt Dickson, 2006. "The analysis of poverty data with endogenous transitions," Fiscal Studies, Institute for Fiscal Studies, vol. 27(1), pages 75-98, March.
- Stewart, Mark B & Swaffield, Joanna K, 1999.
"Low Pay Dynamics and Transition Probabilities,"
London School of Economics and Political Science, vol. 66(261), pages 23-42, February.
- Stewart, M.B. & Swaffield, J.K., 1997. "Low Pay Dynamics and Transition Probabilities," The Warwick Economics Research Paper Series (TWERPS) 495, University of Warwick, Department of Economics.
- Ann Huff Stevens, 1999.
"Climbing out of Poverty, Falling Back in: Measuring the Persistence of Poverty Over Multiple Spells,"
Journal of Human Resources,
University of Wisconsin Press, vol. 34(3), pages 557-588.
- Ann Huff Stevens, 1995. "Climbing Out of Poverty, Falling Back In: Measuring the Persistence of Poverty over Multiple Spells," NBER Working Papers 5390, National Bureau of Economic Research, Inc.
- Duncan, Greg J, et al, 1993. "Poverty Dynamics in Eight Countries," Journal of Population Economics, Springer, vol. 6(3), pages 215-34.
- Buddelmeyer, Hielke & Verick, Sher, 2007.
"Understanding the Drivers of Poverty Dynamics in Australian Households,"
IZA Discussion Papers
2827, Institute for the Study of Labor (IZA).
- Hielke Buddelmeyer & Sher Verick, 2008. "Understanding the Drivers of Poverty Dynamics in Australian Households," The Economic Record, The Economic Society of Australia, vol. 84(266), pages 310-321, 09.
- Martin Biewen, 2009. "Measuring state dependence in individual poverty histories when there is feedback to employment status and household composition," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 24(7), pages 1095-1116.
- repec:ese:iserwp:2005-26 is not listed on IDEAS
- Islam, Nizamul & Shimeles, Abebe, 2007. "Poverty dynamics in Ethiopia: state dependence," Working Papers in Economics 260, University of Gothenburg, Department of Economics.
- Van Kerm, Philippe, 2004. "Une évaluation économétrique des flux vers et hors de la pauvreté en Belgique," IRISS Working Paper Series 2004-04, IRISS at CEPS/INSTEAD.
- Bertola, Giuseppe, 2000.
"Macroeconomics of distribution and growth,"
Handbook of Income Distribution,
in: A.B. Atkinson & F. Bourguignon (ed.), Handbook of Income Distribution, edition 1, volume 1, chapter 9, pages 477-540
- Mary Jo Bane & David T. Ellwood, 1986. "Slipping into and out of Poverty: The Dynamics of Spells," Journal of Human Resources, University of Wisconsin Press, vol. 21(1), pages 1-23.
- Sara Ayllón, 2013. "Understanding poverty persistence in Spain," SERIEs, Spanish Economic Association, vol. 4(2), pages 201-233, June.
- FUSCO Alessio, 2013. "The dynamics of perceived financial difficulties," CEPS/INSTEAD Working Paper Series 2013-24, CEPS/INSTEAD.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Begona Levices).
If references are entirely missing, you can add them using this form.