Modelling Vulnerability in the UK
AbstractIn this paper we examine the concept of vulnerability (Townsend 1994) within the context of income mobility of the poor. We test for the dynamics of vulnerable households in the UK using Waves 1 - 12 of the British Household Panel Survey and find that, of three different types of risks that we test for, household-specific shocks and economy-wide aggregate shocks have the greatest impact on consumption, in comparison to shocks to the income stream. Quantile-specific estimates reveal specific quantiles, particularly those around the poverty line which are most susceptible to be vulnerable to shocks to the income stream. The estimates are found to be robust to household composition and year-specific shocks.
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Bibliographic InfoPaper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 313.
Date of creation: 01 Mar 2007
Date of revision:
Income Variability; Vulnerability; Income Dynamics; BHPS;
Other versions of this item:
- Sanghamitra Bandyopadhyay & Frank A Cowell, 2007. "Modelling Vulnerability in the UK," STICERD - Distributional Analysis Research Programme Papers 89, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
- D1 - Microeconomics - - Household Behavior
- D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
- I32 - Health, Education, and Welfare - - Welfare and Poverty - - - Measurement and Analysis of Poverty
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-04-14 (All new papers)
- NEP-EEC-2007-04-14 (European Economics)
- NEP-LTV-2007-04-14 (Unemployment, Inequality & Poverty)
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