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Disability and Low Income Persistence in Italian Households

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  • Parodi, Giuliana
  • Sciulli, Dario

Abstract

We apply dynamic probit models allowing for unobserved heterogeneity and endogenous initial conditions to IT-SILC data to investigate the low income persistence of households with disabled members. We find that their probability of being in a low income state is higher when compared with households without disabled members. In both cases household head’s characteristics, as employment status and education, contribute to determine low income positions. Our results also support the hypothesis of endogenous initial conditions. Both unobserved heterogeneity and state dependence are important to determine low income positions. Our findings suggest that a structural intervention geared at lifting households out of low income in future requires to get them out of low income at present. Moreover, preventing rather than rescuing actions are preferable.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 28303.

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Date of creation: Sep 2010
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Handle: RePEc:pra:mprapa:28303

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Keywords: Income persistence; disability; dynamic probit model; initial conditions.;

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  1. Ambra Poggi, 2003. "Does persistence of social exclusion exist in Spain?," Working Papers, Department of Applied Economics at Universitat Autonoma of Barcelona wpdea0308, Department of Applied Economics at Universitat Autonoma of Barcelona.
  2. Lorenzo Cappellari & Stephen P. Jemkins, 2002. "Who Stays Poor? Who Becomes Poor? Evidence from the British Household Panel Survey," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 112(478), pages C60-C67, March.
  3. Miguel Angel Malo & Fernando Muñoz-Bullón, 2006. "Employment promotion measures and the quality of the job match for persons with disabilities," Hacienda Pública Española, IEF, IEF, vol. 179(4), pages 79-111, September.
  4. Peter J. Sloane & Melanie K. Jones, 2012. "Disability and Social Exclusion," AIEL Series in Labour Economics, AIEL - Associazione Italiana Economisti del Lavoro, in: Giuliana Parodi & Dario Sciulli (ed.), Social Exclusion. Short and Long Term Causes and Consequences, edition 1, chapter 7, pages 127-148 AIEL - Associazione Italiana Economisti del Lavoro.
  5. Anna Giraldo & Enrico Rettore & Ugo Trivellato, 2002. "The persistence of poverty: true state dependence or unobserved heterogeneity? Some evidence from the Italian Survey on Household Income and Wealth," 10th International Conference on Panel Data, Berlin, July 5-6, 2002, International Conferences on Panel Data B2-1, International Conferences on Panel Data.
  6. Peiyun She & Gina A. Livermore, 2009. "Long-Term Poverty and Disability Among Working-Age Adults," Mathematica Policy Research Reports, Mathematica Policy Research 6179, Mathematica Policy Research.
  7. Tania Burchardt & Asghar Zaidi, 2003. "Comparing incomes when needs differ: Equivalisation for the extra costs of disability in the UK," CASE Papers, Centre for Analysis of Social Exclusion, LSE case64, Centre for Analysis of Social Exclusion, LSE.
  8. Wallace K. C. Mok & Bruce D. Meyer & Kerwin Kofi Charles & Alexandra C. Achen, 2008. "A Note on "The Longitudinal Structure of Earnings Losses among Work-Limited Disabled Workers"," Journal of Human Resources, University of Wisconsin Press, University of Wisconsin Press, vol. 43(3), pages 721-728.
  9. Dávila Quintana, C. Delia & Malo, Miguel A., 2012. "Poverty dynamics and disability: An empirical exercise using the European community household panel," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, Elsevier, vol. 41(4), pages 350-359.
  10. Lorenzo Cappellari & Stephen P. Jenkins, 2002. "Modelling Low Income Transitions," Discussion Papers of DIW Berlin, DIW Berlin, German Institute for Economic Research 288, DIW Berlin, German Institute for Economic Research.
  11. Shawn Fremstad, 2009. "Half in Ten: Why Taking Disability into Account is Essential to Reducing Income Poverty and Expanding Economic Inclusion," CEPR Reports and Issue Briefs, Center for Economic and Policy Research (CEPR) 2009-30, Center for Economic and Policy Research (CEPR).
  12. Giuliana Parodi & Dario Sciulli, 2008. "Disability in Italian households: income, poverty and labour market participation," Applied Economics, Taylor & Francis Journals, Taylor & Francis Journals, vol. 40(20), pages 2615-2630.
  13. Asghar Zaidi & Tania Burchardt, 2005. "Comparing Incomes When Needs Differ: Equivalization For The Extra Costs Of Disability In The U.K," Review of Income and Wealth, International Association for Research in Income and Wealth, International Association for Research in Income and Wealth, vol. 51(1), pages 89-114, 03.
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Cited by:
  1. Parodi, Giuliana & Sciulli, Dario, 2012. "Disability and Social Exclusion Dynamics in Italian Households," MPRA Paper, University Library of Munich, Germany 42445, University Library of Munich, Germany.
  2. Tindara Addabbo & Elena Sarti, 2013. "Access to work and disability: the case of Italy," Center for the Analysis of Public Policies (CAPP), Universita di Modena e Reggio Emilia, Dipartimento di Economia Politica 0111, Universita di Modena e Reggio Emilia, Dipartimento di Economia Politica.

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