European Approaches to Poverty and Social Exclusion

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European Approaches to Poverty and Social Exclusion Anne Bakilana Anne Bakilana World Bank World Bank

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European Approaches to Poverty and Social Exclusion. Anne Bakilana World Bank. Social Exclusion and the EU’s Social Inclusion Agenda. The European Union embraced the social inclusion concept in the mid 1990s as a way of tackling poverty and other social challenges facing its member states. - PowerPoint PPT Presentation

Transcript of European Approaches to Poverty and Social Exclusion

Page 1: European Approaches to Poverty and Social Exclusion

European Approaches to Poverty and Social

Exclusion

Anne BakilanaAnne BakilanaWorld BankWorld Bank

Page 2: European Approaches to Poverty and Social Exclusion

Social Exclusion and the EU’s

Social Inclusion Agenda The European Union embraced the social The European Union embraced the social

inclusion concept in the mid 1990s as a way of inclusion concept in the mid 1990s as a way of tackling poverty and other social challenges tackling poverty and other social challenges facing its member states.facing its member states.

The EU agenda has resulted in common The EU agenda has resulted in common objectives to respond to social exclusion as objectives to respond to social exclusion as described in National Action Plans against described in National Action Plans against poverty and social exclusion.poverty and social exclusion.

Other countries and international organizations Other countries and international organizations have also adopted the concepts of social have also adopted the concepts of social exclusion and inclusion.exclusion and inclusion.

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What is social exclusion?The EU’s Definition:

““a process whereby certain individuals are a process whereby certain individuals are pushed to the edge of society and prevented pushed to the edge of society and prevented

from participating fully by virtue of their from participating fully by virtue of their poverty, or lack of basic competencies and poverty, or lack of basic competencies and

life long learning opportunities, or as a result life long learning opportunities, or as a result of discrimination. This distances them from of discrimination. This distances them from

job, income and education and training job, income and education and training opportunities, as well as social and opportunities, as well as social and

community networks and activities. They community networks and activities. They have little access to power and decision have little access to power and decision

making bodies and thus feel powerless and making bodies and thus feel powerless and unable to take control over the decisions unable to take control over the decisions

that affect their day to day lives” (European that affect their day to day lives” (European Commission 2004). Commission 2004).

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UK government’s definition of social exclusion

‘‘social exclusion happens when people or places social exclusion happens when people or places suffer from a series of problems such as suffer from a series of problems such as unemployment, discrimination, poor skills, low unemployment, discrimination, poor skills, low incomes, poor housing, high crime, ill health and incomes, poor housing, high crime, ill health and family breakdown. When such problems combine family breakdown. When such problems combine they can create a vicious cycle. Social exclusion they can create a vicious cycle. Social exclusion can happen as a result of problems that face one can happen as a result of problems that face one person in their life. But it can also start from person in their life. But it can also start from birth. Being born into poverty or to parents with birth. Being born into poverty or to parents with low skills has a major influence on future life low skills has a major influence on future life chances.’chances.’

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UK’s Department for International Development (DFID)’ s definition

a process by which certain groups are systematically a process by which certain groups are systematically disadvantaged because they are discriminated disadvantaged because they are discriminated against on the basis of their ethnicity, race, against on the basis of their ethnicity, race, religion, sexual orientation, caste, descent, religion, sexual orientation, caste, descent, gender, age, disability, HIV status, migrant status gender, age, disability, HIV status, migrant status or where they live. Discrimination occurs in public or where they live. Discrimination occurs in public institutions, such as the legal system or education institutions, such as the legal system or education and health services, as well as social institutions and health services, as well as social institutions like the household. People are excluded by like the household. People are excluded by institutions and behavior that reflect, enforce and institutions and behavior that reflect, enforce and reproduce prevailing social attitudes and values, reproduce prevailing social attitudes and values, particularly those of powerful groups in society. particularly those of powerful groups in society.

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Main features of the various definitions of social

exclusion the various concepts of exclusion imply a the various concepts of exclusion imply a

process, process, individuals are excluded from what other individuals are excluded from what other

members of a society are participating in, members of a society are participating in, there is no clear definition or defined there is no clear definition or defined

measures of social exclusion, measures of social exclusion, social exclusion is still a contested term; and social exclusion is still a contested term; and

despite its wide use in European research, despite its wide use in European research, debates and policies, its definition and usage debates and policies, its definition and usage varies significantly from person to person varies significantly from person to person and has continually evolved over time.and has continually evolved over time.

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From Poverty to Poverty and Social Exclusion

The social exclusion concept originated in France about 30 The social exclusion concept originated in France about 30 years ago;years ago;

The term was mostly used to describe individuals who were The term was mostly used to describe individuals who were not covered by the social security systems of the time (these not covered by the social security systems of the time (these included single mothers, substance abusers and drug included single mothers, substance abusers and drug addicts; and people with physical and mental disabilities);addicts; and people with physical and mental disabilities);

Over time this grew to also include the unemployed, the Over time this grew to also include the unemployed, the homeless, dissatisfied youth, the old, immigrants, etc. homeless, dissatisfied youth, the old, immigrants, etc.

In the late 1990s, the UK’s Labor government put a spotlight In the late 1990s, the UK’s Labor government put a spotlight on the terms social exclusion and social inclusion. on the terms social exclusion and social inclusion.

UK Govt established a Social Exclusion Unit whose main task UK Govt established a Social Exclusion Unit whose main task is to implement government policies on inclusion and is to implement government policies on inclusion and regeneration activities. regeneration activities.

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The UK Government’s Social Exclusion Unit

Initially set up in 1997 first under the Cabinet Unit; and Initially set up in 1997 first under the Cabinet Unit; and then later moved to the Office of the Deputy Prime Minister then later moved to the Office of the Deputy Prime Minister in 2002. in 2002.

There is a Minister for Social Exclusion who is a Minister There is a Minister for Social Exclusion who is a Minister under the Cabinet Office. under the Cabinet Office.

Consultations between the Prime Minister, Deputy Prime Consultations between the Prime Minister, Deputy Prime Minister, various government departments and other Minister, various government departments and other stakeholders decide on work program. The Unit’s work stakeholders decide on work program. The Unit’s work includes: includes:

i) Policy Reports: Based on consultations with people who i) Policy Reports: Based on consultations with people who have the experience of being excluded; and also includes have the experience of being excluded; and also includes wide participation beyond government departments wide participation beyond government departments including local authorities, business representatives and including local authorities, business representatives and the NGO sector; the NGO sector;

ii) Research and Strategy: To understand drivers of social ii) Research and Strategy: To understand drivers of social exclusion so that policies can not only tackle the problems exclusion so that policies can not only tackle the problems but also prevent future exclusion; and but also prevent future exclusion; and

iii) Implementing Policy and Supporting Best Practices: iii) Implementing Policy and Supporting Best Practices: promotes best practices from undertaken projects. promotes best practices from undertaken projects.

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Why deal with social exclusion?Social exclusion experts argue

that: social exclusion is wider than the social exclusion is wider than the

traditional concept of poverty;traditional concept of poverty; it is about processes that lead to non-it is about processes that lead to non-

participation in societies’ activities;participation in societies’ activities; it is multidimensional;it is multidimensional; it embraces concepts of vulnerability to it embraces concepts of vulnerability to

poverty;poverty; one does not have to be poor to be one does not have to be poor to be

socially excluded;socially excluded; non participation in societies’ activities non participation in societies’ activities

is as critical as poverty.is as critical as poverty.

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Who are the socially excluded?Examples from new EU states’

analyses Those on low incomes;Those on low incomes; The unemployed;The unemployed; Individuals with disability; Individuals with disability; Non citizens; ethnicity minorities; Non citizens; ethnicity minorities;

immigrants; immigrants; Families with many children; Families with many children; The homeless and those in poor The homeless and those in poor

housing; housing; The young; the old; children;The young; the old; children; Women.Women.

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Examples of socially excluded groupsExamples of socially excluded groupsPolandPoland LithuaniaLithuania LatviaLatvia EstoniaEstonia UnemployedUnemployed Low income families; Low income families;

long term unemployedlong term unemployed Long term Long term unemployedunemployed

Lowly paid workers; Lowly paid workers; long term long term unemployedunemployed

DisabledDisabled Disabled;Disabled; Disabled; children Disabled; children with disabilitieswith disabilities

DisabledDisabled

The Roma; The Roma; Immigrants Immigrants and refugees; and refugees; prisoners prisoners

Ethnic minorities; Ethnic minorities; asylum seekers; victims asylum seekers; victims of violence and of violence and trafficking; prostitution; trafficking; prostitution; ex prisoners;ex prisoners;

Ethnic minorities;Ethnic minorities; Ex prisoners; Ex prisoners; Trafficking victimsTrafficking victims

Russian speaking Russian speaking populationspopulations

Families Families with 3+ with 3+ childrenchildren

Single parents; Single parents; Families with 3+ Families with 3+ children; Orphaned children; Orphaned children; children children; children without care; youth and without care; youth and children from excluded children from excluded familiesfamilies

Low income h/holds Low income h/holds with 3+ children; with 3+ children; single parent h/holdssingle parent h/holds

Single families; Single families; families with 3+ families with 3+ childrenchildren

Farmers; Farmers; Rural Rural residents; residents; HomelessHomeless

The homeless; The homeless; Farmers and rural Farmers and rural populationspopulations

The homelessThe homeless The homeless; Lack The homeless; Lack of private housing.of private housing.

T he AgedT he Aged PensionersPensioners The Old, Children and The Old, Children and Youth in careYouth in care

YouthYouth

Victims of sexual Victims of sexual violenceviolence

Women who want to Women who want to return to work after return to work after childbearingchildbearing

Women, the Women, the homelesshomeless

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Manifesto to eradicate poverty and to fight Manifesto to eradicate poverty and to fight social exclusion in member states by 2010. social exclusion in member states by 2010.

(The European Council of Lisbon, March 2000) (The European Council of Lisbon, March 2000) A consensus to eradicate poverty and to fight A consensus to eradicate poverty and to fight

social exclusion in member states by 2010;social exclusion in member states by 2010; The following policy objectives were adopted:The following policy objectives were adopted:

1) To facilitate participation in employment 1) To facilitate participation in employment and access by all to the resources, rights, and access by all to the resources, rights, goods and services;goods and services;2) To prevent the risks of exclusion;2) To prevent the risks of exclusion;3) To help the most vulnerable;3) To help the most vulnerable;4) To mobilize all relevant bodies.4) To mobilize all relevant bodies.

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What is Social Inclusion?What is Social Inclusion?

the process that will enable every the process that will enable every person in society to participate in person in society to participate in normal activities of societies they normal activities of societies they

live in. live in.

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National Action Plans for National Action Plans for Social InclusionSocial Inclusion

individual country’s analyses of what individual country’s analyses of what groups were socially excluded; groups were socially excluded;

describe specific actions to be taken describe specific actions to be taken in order to become more inclusive. in order to become more inclusive.

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Counting the Socially Excluded: The Laeken European Council Counting the Socially Excluded: The Laeken European Council (December 2001) endorsed common statistical indicators of social (December 2001) endorsed common statistical indicators of social

exclusion and poverty that will serve as key elements in monitoring exclusion and poverty that will serve as key elements in monitoring progress in the fight against poverty and social exclusion (Laeken progress in the fight against poverty and social exclusion (Laeken

Indicators) Indicators) At-risk-of-poverty rate by gender and various age groupsAt-risk-of-poverty rate by gender and various age groups At-risk-of-poverty rate by most frequent activity and by gender and selected age groups At-risk-of-poverty rate by most frequent activity and by gender and selected age groups  At-risk-of-poverty rate by household type At-risk-of-poverty rate by household type  At-risk-of-poverty rate by accommodation tenure status and by gender and selected age At-risk-of-poverty rate by accommodation tenure status and by gender and selected age

groups groups  At-risk-of-poverty rate by work intensity of the household At-risk-of-poverty rate by work intensity of the household  At-risk-of-poverty threshold illustrative values At-risk-of-poverty threshold illustrative values  Inequality of income distribution s80/s20 income quintile share ratioInequality of income distribution s80/s20 income quintile share ratio Persistent at-risk-of-poverty rate by gender and selected age groups Persistent at-risk-of-poverty rate by gender and selected age groups  Relative median at-risk-of-poverty gap by gender and selected age groupsRelative median at-risk-of-poverty gap by gender and selected age groups Regional cohesion by gender (variation in regional employment rates)Regional cohesion by gender (variation in regional employment rates) Long term unemployment rate by gender and selected age groups Long term unemployment rate by gender and selected age groups  Persons living in jobless households by gender and selected age groups Persons living in jobless households by gender and selected age groups  Early school leavers not in education or training by gender Early school leavers not in education or training by gender  Life expectancy at birth by gender Life expectancy at birth by gender  Self defined health status by income level by gender and age Self defined health status by income level by gender and age  Dispersion around the at-risk-of-poverty threshold by gender and selected age groups Dispersion around the at-risk-of-poverty threshold by gender and selected age groups  At-risk-of-poverty rate anchored at one moment in time by gender and selected age At-risk-of-poverty rate anchored at one moment in time by gender and selected age

groups groups  At-risk-of-poverty rate before cash social transfers by gender and selected age groups At-risk-of-poverty rate before cash social transfers by gender and selected age groups  Inequality of income distribution Gini coefficient Inequality of income distribution Gini coefficient  Persistent at-risk-of-poverty rate (alternative threshold) by gender and selected age groupsPersistent at-risk-of-poverty rate (alternative threshold) by gender and selected age groups Long term unemployment share by gender and age Long term unemployment share by gender and age  Very long term unemployment rate by gender and age Very long term unemployment rate by gender and age  In-work at risk of poverty rate by gender and ageIn-work at risk of poverty rate by gender and age

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From counting the excluded to From counting the excluded to measuring exclusion: If social measuring exclusion: If social exclusion is a process, exclusion is a process, can we measure it?can we measure it? How can we capture the processes that How can we capture the processes that

leads to exclusion?leads to exclusion? Given its multidimensional focus, can this Given its multidimensional focus, can this

be done in one discipline of study?be done in one discipline of study? Given the very generous definition of Given the very generous definition of

exclusion, what should we focus on?exclusion, what should we focus on? Given the lack of a single definition of Given the lack of a single definition of

exclusion, what should we be analyzing?exclusion, what should we be analyzing?

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The EU Social Inclusion Study:The EU Social Inclusion Study:An attempt to measure An attempt to measure determinants of social determinants of social

exclusionexclusion extending the debate outside discussions extending the debate outside discussions

about monetary deprivation and poverty about monetary deprivation and poverty adopted the capability deprivation which says adopted the capability deprivation which says

that due to social and economic factors that due to social and economic factors certain individuals in society may never reach certain individuals in society may never reach their full potential their full potential

individuals who are deprived of certain individuals who are deprived of certain capabilities could be excluded from capabilities could be excluded from participating in the labor force, consumption, participating in the labor force, consumption, wealth accumulation and from social functionswealth accumulation and from social functions

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Recognize that jobs and income; education and Recognize that jobs and income; education and training opportunities; social, community networks training opportunities; social, community networks

and activities are central to the process of and activities are central to the process of inclusion. inclusion.

Go beyond quantifying the percent of people that Go beyond quantifying the percent of people that lack financial means (or that do not consume lack financial means (or that do not consume

enough) as a proportion of the total population.enough) as a proportion of the total population.

Social exclusion encompasses more than poverty, Social exclusion encompasses more than poverty, but, poverty is a component of Social exclusionbut, poverty is a component of Social exclusion

Profile the proportion of Profile the proportion of the population that is the population that is not included in not included in society’s production, society’s production, consumption, political consumption, political engagement and engagement and social interaction.social interaction.

Excluded from Financial Capital Excluded from Financial Capital

Those who are excluded from Those who are excluded from access to earnings and wealthaccess to earnings and wealth

Excluded from Human CapitalExcluded from Human Capital

Those with no or very limited Those with no or very limited Education, skillsEducation, skills

Excluded from Physical Capital Excluded from Physical Capital

Do not own any Housing or Do not own any Housing or LandLand

Excluded from Social Capital Excluded from Social Capital

Those with limited friends, Those with limited friends, family, community family, community

interactions and little interactions and little political empowermentpolitical empowerment

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Three Forms of CapitalThree Forms of Capital Financial CapitalFinancial CapitalFor this exercise, all those with the means to earn financial For this exercise, all those with the means to earn financial

capital through employment, farms, rental income were capital through employment, farms, rental income were grouped as having financial capital.grouped as having financial capital.

Physical CapitalPhysical CapitalAn individual was defined as having physical capital if they An individual was defined as having physical capital if they

privately own land or property. privately own land or property.

Human CapitalHuman CapitalAn individual has human capital from their education and An individual has human capital from their education and

years of schooling and training. For this exercise, those years of schooling and training. For this exercise, those lacking education capital were defined as those who did not lacking education capital were defined as those who did not reach the compulsory level of education in their country.reach the compulsory level of education in their country.

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What data did we have?What data did we have?YearYear Sample Sample

SizeSizeEstimated Estimated Population Population

SizeSize

Estonia Household Budget Survey Estonia Household Budget Survey 20042004 3,1653,165 1,340,4581,340,458

Latvia Household Budget Survey Latvia Household Budget Survey 20042004 3,9133,913 2,278,1612,278,161

Lithuania Household Budget SurveyLithuania Household Budget Survey 20042004 7,9697,969 3,626,4623,626,462

Poland Survey of Household BudgetPoland Survey of Household Budget 20042004 32, 21432, 214 37,784,20837,784,208

Hungary Household Budget SurveyHungary Household Budget Survey 20042004 23,51323,513 9,985,0249,985,024

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What data was used to compile What data was used to compile capitals?capitals?

   Lacking in Financial CapitalLacking in Financial Capital Lacking in Human CapitalLacking in Human Capital Lacking in Physical CapitalLacking in Physical Capital

HungaryHungary Living on non-employment and non Living on non-employment and non investment sources of incomeinvestment sources of income

Have no education or did not Have no education or did not achieve compulsory level of achieve compulsory level of education; and are not education; and are not attending school attending school

Do not own the houses they live in; Do not own the houses they live in; owns no other dwelling; do not owns no other dwelling; do not own any land own any land

LatviaLatvia Living on non-employment and non Living on non-employment and non investment sources of income investment sources of income

Have no education or did not Have no education or did not achieve compulsory level of achieve compulsory level of education; and are not education; and are not attending school attending school

Do not own the houses they live in; Do not own the houses they live in; owns no other dwelling; do not owns no other dwelling; do not own any land; own any land;

PolandPoland Are living on non-work and non Are living on non-work and non investment sources of income investment sources of income

Did not achieve the compulsory Did not achieve the compulsory level of and are not attending level of and are not attending schoolschool

Do not own the houses they live in; Do not own the houses they live in; and have no second house or and have no second house or summer house; do not own land summer house; do not own land

EstoniaEstonia Are not earning, rely on benefits as main Are not earning, rely on benefits as main source of income source of income

Are not in education and have not Are not in education and have not achieved elementary, have achieved elementary, have elementary or have basic elementary or have basic education, have not education, have not completed the compulsory completed the compulsory level of education level of education

Do not own the houses they live in, Do not own the houses they live in, do not own another house and do not own another house and do not own agricultural land do not own agricultural land

LithuaniaLithuania Have as their main source of income Have as their main source of income unemployment benefit, stipend, unemployment benefit, stipend, social assistance benefit, dependents, social assistance benefit, dependents,

Have not completed the Have not completed the compulsory level of compulsory level of education and are currently education and are currently not in schoolnot in school

Do not own the houses they live in Do not own the houses they live in and don’t own another house, and don’t own another house, do not own land.do not own land.

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What did we find? What did we find? The percent of the population that lacked financial The percent of the population that lacked financial

capital was at least 20%, rising to as high as 42% in capital was at least 20%, rising to as high as 42% in Poland.Poland.

in Poland where those who had not worked in the last in Poland where those who had not worked in the last seven days formed 70% of those excluded from seven days formed 70% of those excluded from financial capital. financial capital.

Youth aged 15-24 formed the largest proportion of Youth aged 15-24 formed the largest proportion of those excluded from financial capital, for e.g. in those excluded from financial capital, for e.g. in Hungary 70% of those excluded from financial capital Hungary 70% of those excluded from financial capital are from this age group. are from this age group.

In all countries, the larger proportion of those excluded In all countries, the larger proportion of those excluded from financial capital were women: 58% in Latvia and from financial capital were women: 58% in Latvia and Lithuania.Lithuania.

Quite large proportions of those excluded from financial Quite large proportions of those excluded from financial capital were those with secondary levels of education. capital were those with secondary levels of education.

Urban residents formed the largest proportion of those Urban residents formed the largest proportion of those excluded from financial capital.excluded from financial capital.

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What did we find?What did we find? The largest proportion of those that lacked human capital The largest proportion of those that lacked human capital

was of individuals in the 40-64 age groups. was of individuals in the 40-64 age groups. Without exception, the largest proportion of those that Without exception, the largest proportion of those that

lacked human capital was of individuals in the 40-64 age lacked human capital was of individuals in the 40-64 age groups. groups.

Women formed the largest proportion of those that lacked Women formed the largest proportion of those that lacked human capital in Poland, Hungary and Lithuania. human capital in Poland, Hungary and Lithuania.

The majority of those who lacked human capital did have The majority of those who lacked human capital did have some years of education. some years of education.

Except for Hungary, the largest proportion of those lacking Except for Hungary, the largest proportion of those lacking human capital were rural residents [in Estonia the human capital were rural residents [in Estonia the distribution is close: 49 vs. 51]. distribution is close: 49 vs. 51].

Unlike what was the case for exclusion from financial Unlike what was the case for exclusion from financial capital, a larger proportion of those that lacked human capital, a larger proportion of those that lacked human capital were individuals with disabilities, around a quarter capital were individuals with disabilities, around a quarter of those with no human capital were disabled in Poland of those with no human capital were disabled in Poland Estonia and Hungary and a third in Lithuania. Estonia and Hungary and a third in Lithuania.

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Poverty and social exclusionPoverty and social exclusion Results show that not all those Results show that not all those

who are excluded from the various who are excluded from the various forms of capitals are poor; in fact forms of capitals are poor; in fact the majority of those who are the majority of those who are excluded from the various forms excluded from the various forms of capital were not in the bottom of capital were not in the bottom consumption quintile.consumption quintile.

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Lessons for methodology and data Lessons for methodology and data requirementsrequirements

The data available were all from cross The data available were all from cross sectional surveys making it impossible to sectional surveys making it impossible to analyze the dynamics of exclusion analyze the dynamics of exclusion

Since the data come from household Since the data come from household surveys, by definition, those who do not surveys, by definition, those who do not live in households are not included live in households are not included

Because of a limited number of variables Because of a limited number of variables available in such household budget available in such household budget surveys, it was not possible to quantify surveys, it was not possible to quantify ownership of social capital ownership of social capital

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Lessons for methodology and data requirements

Analyses focused on the 15-64 age groups; because Analyses focused on the 15-64 age groups; because available variables were more relevant for working available variables were more relevant for working adults and not for children or the elderly (even adults and not for children or the elderly (even Eurostat has no indicators for children’s exclusion) Eurostat has no indicators for children’s exclusion)

It was not possible to assess the contribution of community and national level capitals that do contribute to individuals’ possession of the various forms of capitals. Community and national capitals could include social infrastructure such as schools, hospitals, roads, and other forms of collective physical capital.

Country data are not directly comparable because variables used to compile the various forms of capitals are not identical across countries.

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Lessons for methodology and data requirements

It is not possible to assess or compare how lack of access to a form of capital is associated with a level of deprivation. That is, is someone who lacks financial capital as worse off as someone who lacks human capital? Does an individual who lacks human and financial capital worse off than the individual that lacks just one of these?

Bivariate rather than multivariate analysis for the probability of being both poor and lacking in capitals might not be sufficient to explain the very complex interaction between socio-economic characteristics on one hand and lack of capitals and poverty on the other.