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The impact of the crisis on unemployment and household income in Italy and Spain

Author

Listed:
  • Tindara Addabbo

    () (University of Modena & Reggio Emilia)

  • Rosa García-Fernández

    (University of Granada)

  • Carmen Llorca-Rodríguez

    (University of Granada)

  • Anna Maccagnan

    (University of Modena & Reggio Emilia)

Abstract

This paper aims at evaluating the effect of the current economic crisis on household income and poverty in Spain and Italy. As data on 2009 income has not been released yet, we have carried out a microsimulation analysis using data drawn for the European Statistics on Income and Living Conditions Survey of 2007 and data of the Labour Force Survey of 2009. We propose a technique that is based on the imputation of transition probabilities into different labour market status as calculated on 2009 data on the data for 2007 and income simulation. Our results reveal a 3% reduction in equivalised household income in Spain and a 1.16% reduction in Italy. Despite this difference, for both countries the Gini Index increases from 0.31 to 0.32, suggesting that the Spanish unemployment protection system is more generous than the Italian one.

Suggested Citation

  • Tindara Addabbo & Rosa García-Fernández & Carmen Llorca-Rodríguez & Anna Maccagnan, 2011. "The impact of the crisis on unemployment and household income in Italy and Spain," Working Papers 235, ECINEQ, Society for the Study of Economic Inequality.
  • Handle: RePEc:inq:inqwps:ecineq2011-235
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    File URL: http://www.ecineq.org/milano/WP/ECINEQ2011-235.pdf
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    References listed on IDEAS

    as
    1. Herwig Immervoll & Horacio Levy & Christine Lietz & Daniela Mantovani & Holly Sutherland, 2006. "The sensitivity of poverty rates to macro-level changes in the European Union," Cambridge Journal of Economics, Oxford University Press, vol. 30(2), pages 181-199, March.
    2. Anonymous, 2009. "2009 Annual Agricultural Outlook," Staff Papers 47453, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    3. Stephen R. G. Jones & W. Craig Riddell, 2006. "Unemployment and Nonemployment: Heterogeneities in Labor Market States," The Review of Economics and Statistics, MIT Press, vol. 88(2), pages 314-323, May.
    4. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
    5. Andrea Brandolini & Piero Cipollone & Eliana Viviano, 2006. "Does The Ilo Definition Capture All Unemployment?," Journal of the European Economic Association, MIT Press, vol. 4(1), pages 153-179, March.
    6. Amartya Sen, 1997. "Inequality, Unemployment and Contemporary Europe," STICERD - Development Economics Papers - From 2008 this series has been superseded by Economic Organisation and Public Policy Discussion Papers 07, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    unemployment; crisis; simulation; poverty.;

    JEL classification:

    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty

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