Incidence, intensity and inequality of poverty in Italy

Abstract

Aim of the paper is to analyse unidimensional poverty in Italy and in its macro-regions. In a period of tight resources, the sub-national dimension in measuring poverty is crucial. Indeed, information on household income distribution and poverty at sub-national level may help policymakers focus their efforts and enhance the effectiveness of public interventions. Moreover, high disparities between macro-regions in a given country might undermine national economic growth and lead to ever-increasing regional imbalances over time. To achieve our aim, we use data from the Italian version of the Statistics on Income and Living Conditions (IT-SILC) for two different years, 2005 and 2015. The so-called TIP curves, a statistical tool for representing the three different aspects of poverty - incidence, intensity and inequality, provides poverty orderings consistent with a large class of poverty indices and of poverty thresholds. Finally, we also decompose the variation of poverty index over time to better understand what are the main factors that influence poverty levels. The main conclusion from the empirical application is an unambiguous increase in poverty levels from 2005 to 2015, both in the entire Italian population as well as its macro regions.