Understanding and analyzing changes in poverty among the elderly across 16 European countries using decomposition approach

The issue of relative poverty is emerging as a prominent topic in research and society. However, studies focusing on the determinants of relative poverty among the elderly within a comparative context over time remain scarce. To address this gap, this study employs the reweighting Recentered Influence Function-Oaxaca Blinder decomposition method to understand the changes in relative poverty among the elderly across 16 European countries and utilizes microdata from the Luxembourg Income Study spanning approximately 2005–2022. The results indicate reduction in relative poverty among the elderly. The results demonstrate the following key factors that contributed to reducing poverty rates among the elderly: participation in the labor market, university attendance of the household head and access to public and private pensions. In contrast, living alone has been associated with an increase in poverty rates. These findings may have implications for policy. Hence, to alleviate poverty among the elderly, improvements in terms of job opportunities and the efficacy of pension systems can be extremely helpful.