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More than Cash: Societal Influences on the Risk of Material Deprivation

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  • Sabine Israel

    () (Carl von Ossietzky University Oldenburg)

Abstract

Abstract This paper considers the societal factors which determine a household’s command over resources aside from cash income. The aim of this paper is to explain why in some European countries the deprivation risk for households is relatively low despite high absolute poverty levels. Two main mechanisms at the societal level are identified that reduce deprivation but which do not directly impact disposable income. The first is the provision of in-kind benefits which increase the purchasing power of households; the second is informal support from networks. An analysis using 2012 EU-SILC data shows that both factors are significant in explaining the cross-country variation in Europe while controlling for national affluence. Households which have higher in-kind benefits from social services as well as non-cash company benefits and their own production show lower levels of deprivation. On the national level, universally provided social services (e.g. housing, healthcare or transport) can substantially improve the living conditions of the income poor and reduce social exclusion. However, the main factor explaining cross-country variation in deprivation is the provision of informal support from networks. When the social context is dominated by low generalised trust, social support for poor households is lower, leading to a marginalisation of the poor. In contrast, when trust is high, support from kin and non-kin networks in terms of lump sum transfers or co-usage of consumer goods significantly improve living conditions.

Suggested Citation

  • Sabine Israel, 2016. "More than Cash: Societal Influences on the Risk of Material Deprivation," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 129(2), pages 619-637, November.
  • Handle: RePEc:spr:soinre:v:129:y:2016:i:2:d:10.1007_s11205-015-1138-8
    DOI: 10.1007/s11205-015-1138-8
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    References listed on IDEAS

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    1. Ruud Muffels & Didier Fouarge, 2004. "The Role of European Welfare States in Explaining Resources Deprivation," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 68(3), pages 299-330, September.
    2. Guio, Anne-Catherine & Fusco, Alessio & Marlier, Eric, 2009. "A European Union Approach to Material Deprivation using EU-SILC and Eurobarometer data," IRISS Working Paper Series 2009-19, IRISS at CEPS/INSTEAD.
    3. Alari Paulus & Holly Sutherland & Panos Tsakloglou, 2010. "The distributional impact of in-kind public benefits in European countries," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 29(2), pages 243-266.
    4. Brian Nolan & Christopher T. Whelan, 2010. "Using non-monetary deprivation indicators to analyze poverty and social exclusion: Lessons from Europe?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 29(2), pages 305-325.
    5. Peter Whiteford, 1995. "The Use of Replacement Rates in International Comparisons of Benefit Systems," Discussion Papers 0054, University of New South Wales, Social Policy Research Centre.
    6. Paul Dickes & Alessio Fusco & Eric Marlier, 2010. "Structure of National Perceptions of Social Needs Across EU Countries," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 95(1), pages 143-167, January.
    7. Rolf Aaberge & Audun Langørgen & Petter Lindgren, 2013. "The distributional impact of public services in," Discussion Papers 746, Statistics Norway, Research Department.
    8. Iacovou, Maria & Kaminska, Olena & Levy, Horacio, 2012. "Using EU-SILC data for cross-national analysis: strengths, problems and recommendations," ISER Working Paper Series 2012-03, Institute for Social and Economic Research.
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