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Poverty persistence in Britain: A multivariate analysis using the BHPS, 1991–1997

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  • Francesco Devicienti

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Abstract

This paper uses longitudinal data from the BHPS, Waves 1–7, to document low-income dynamics for individuals living in Britain in 1990s. Poverty entry and exit hazard rates are estimated and used to calculate the distribution of time spent poor over a six-year period. The results underline the importance of accounting for individuals' repeated spells of poverty when measuring poverty persistence. Using discrete-time proprotional hazard rate models, the paper then seeks to ‘explain’ and forecast the observed chances of exit/entering poverty and the distribution of time spent in poverty for individuals with selected characteristics. The socio-economic correlates of the observed poverty patterns are investigated, including the relative importance of both household and individual characteristics. Copyright Springer-Verlag 2002

Suggested Citation

  • Francesco Devicienti, 2002. "Poverty persistence in Britain: A multivariate analysis using the BHPS, 1991–1997," Journal of Economics, Springer, vol. 77(1), pages 307-340, December.
  • Handle: RePEc:kap:jeczfn:v:77:y:2002:i:1:p:307-340
    DOI: 10.1007/BF03052509
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    References listed on IDEAS

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    1. Meyer, Bruce D, 1990. "Unemployment Insurance and Unemployment Spells," Econometrica, Econometric Society, vol. 58(4), pages 757-782, July.
    2. Lillard, Lee A & Willis, Robert J, 1978. "Dynamic Aspects of Earning Mobility," Econometrica, Econometric Society, vol. 46(5), pages 985-1012, September.
    3. 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.
    4. Böheim, René & Taylor, Mark P, 2000. "Unemployment Duration and Exit States in Britain," CEPR Discussion Papers 2500, C.E.P.R. Discussion Papers.
    5. 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.
    6. Böheim, René & Jenkins, Stephen P., 2000. "Do current income and annual income measures provide different pictures of Britain's income distribution?," ISER Working Paper Series 2000-16, Institute for Social and Economic Research.
    7. Xavier Ramos, 2003. "The Covariance Structure of Earnings in Great Britain, 1991-1999," Economica, London School of Economics and Political Science, vol. 70(278), pages 353-374, May.
    8. 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.
    9. Gottschalk, Peter & Moffitt, Robert A, 1994. "Welfare Dependence: Concepts, Measures, and Trends," American Economic Review, American Economic Association, vol. 84(2), pages 38-42, May.
    10. Stephen P. Jenkins, 2000. "Modelling household income dynamics," Journal of Population Economics, Springer;European Society for Population Economics, vol. 13(4), pages 529-567.
    11. Ondrich, Jan & Rhody, Stephen E., 1999. "Multiple spells in the Prentice-Gloeckler-Meyer likelihood with unobserved heterogeneity," Economics Letters, Elsevier, vol. 63(2), pages 139-144, May.
    12. Jarvis, Sarah & Jenkins, Stephen P, 1998. "How Much Income Mobility Is There in Britain?," Economic Journal, Royal Economic Society, vol. 108(447), pages 428-443, March.
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    More about this item

    Keywords

    Poverty Dynamics; Poverty Persistence; Multiple Spells; Hazard Rate Models; I32; I31;

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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