TY - JOUR
T1 - Approximations to the Truth
T2 - Comparing Survey and Microsimulation Approaches to Measuring Income for Social Indicators
AU - Figari, Francesco
AU - Iacovou, Maria
AU - Skew, Alexandra J.
AU - Sutherland, Holly
N1 - Funding Information:
Acknowledgments This paper forms part of the ALICE (Analysis of Life Chances in Europe) project, which is funded by the UK’s Economic and Social Research Council (ESRC) under grant number RES-062-23-1455. We use the EU-SILC UDB versions 2005-1 and 2005-2 obtained from the European Commission (Eurostat) under contract No. EU-SILC/2007/03; the Austrian version of the EU-SILC 2004 made available
Funding Information:
by Statistik Austria; and IT-SILC XUDB 2004—version November 2007, made available by ISTAT. The development of EUROMOD has been supported by a series of European Commission Framework Programme grants and we are grateful to all members of the EUROMOD consortium, past and present. We would like to thank participants at ALICE project meetings and at the GESIS conference 2009 in Mannheim for useful comments. The results and conclusions presented in the paper reflect those of the authors and are not the responsibility of data providers or the ESRC.
PY - 2012/2
Y1 - 2012/2
N2 - In this paper, we evaluate income distributions in four European countries (Austria, Italy, Spain and Hungary) using two complementary approaches: a standard approach based on reported incomes in survey data, and a microsimulation approach, where taxes and benefits are simulated. These two approaches may be expected to generate slightly different results, particularly in respect of individuals on lower incomes, because benefit receipts tend to be under-reported in survey data, and over-estimated in microsimulation procedures. However, we find that the two approaches do in fact produce reasonably consistent results, in terms of both inequality measures and poverty rates. To the extent that the results differ, we explore the reasons why these differences arise, and suggest directions for future research, in which each approach may inform improvements in the other.
AB - In this paper, we evaluate income distributions in four European countries (Austria, Italy, Spain and Hungary) using two complementary approaches: a standard approach based on reported incomes in survey data, and a microsimulation approach, where taxes and benefits are simulated. These two approaches may be expected to generate slightly different results, particularly in respect of individuals on lower incomes, because benefit receipts tend to be under-reported in survey data, and over-estimated in microsimulation procedures. However, we find that the two approaches do in fact produce reasonably consistent results, in terms of both inequality measures and poverty rates. To the extent that the results differ, we explore the reasons why these differences arise, and suggest directions for future research, in which each approach may inform improvements in the other.
KW - Europe
KW - Income
KW - Inequality
KW - Microsimulation
KW - Poverty
UR - https://www.scopus.com/pages/publications/84855324115
U2 - 10.1007/s11205-010-9775-4
DO - 10.1007/s11205-010-9775-4
M3 - Article
SN - 0303-8300
VL - 105
SP - 387
EP - 407
JO - Social Indicators Research
JF - Social Indicators Research
IS - 3
ER -
SDG 10 Reduced Inequalities