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The welfare of poorer older people in Belgium and the Netherlands :An application of quantile regression

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  • Bart Capéau
  • Jozef Pacolet

Abstract

On the basis of the SHARE data, we estimate age-conditional quantiles at the 5th, 10th, 15th, 20th, 25th and 50th percentile levels for equivalised gross income, net financial assets and consumption levels, as well as for a (remaining) lifetime utility indicator of people over the age of 50 in Belgium and the Netherlands. We conclude that the poor performance of Belgium in terms of older people’s income, compared with the Netherlands, is mitigated when the consumption figures are considered. However, the picture presented by the wealth figures is more diverse: the median net financial assets position for the 55-70 age group in Belgium is higher than that in the Netherlands, but their relative ranking on the basis of the first quartile value is reversed for several age groups. In terms of lifetime utility, the two countries do equally well. Income and asset poverty do not seem closely related to consumption poverty. Remarkably, the income distribution of the poorer half of older people in Belgium turns out to be skewed to the left, but income inequality is lower in Belgium than in the Netherlands. The reverse holds true for consumption inequality. Wealth inequality is highly skewed to the right in both countries, but no clear conclusions can be drawn about their relative ranking in terms of inequality.

Suggested Citation

  • Bart Capéau & Jozef Pacolet, 2009. "The welfare of poorer older people in Belgium and the Netherlands :An application of quantile regression," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 52(1), pages 5-33.
  • Handle: RePEc:bxr:bxrceb:2013/80754
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    More about this item

    Keywords

    Welfare measurement; Life cycle hypothesis; Lifetime utility; Nonparametric quantile regression;

    JEL classification:

    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General

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