Ambra Poggi

Poverty and social exclusion: two sides of the same coin or dynamically interrelated processes?

There is growing interest in the analysis and measurement of social exclusion, to complement the static and dynamic literature on income poverty. On theoretical grounds, social exclusion and income poverty are seen as different processes, but with closely interrelated dynamics. However, our empirical understanding of the way these two processes dynamically interact at the individual level is still very limited. To shed some light on the issue, we use a dynamic bivariate probit model, controlling for unobserved heterogeneity and Wooldridge (2005)-type initial conditions. Both the first- and second-order Markov dynamics are examined. We estimate the model using the Italian sample of the European Community Household Panel (ECHP), waves 1–8, and find a sizable extent of state dependence in both poverty and social exclusion. Moreover, there are dynamic cross-effects implying that poverty and social exclusion are mutually reinforcing. Social policies aimed at eradicating poverty and avoiding individuals’ social and economic marginalization should take these interaction effects explicitly into account.

Chapter 4 Are informality and poverty dynamically interrelated? Evidence from Argentina

Poverty and informal employment are often regarded as correlated phenomena. Many empirical studies have shown that informal employment has a causal impact on household poverty, mainly through low wages. Yet other studies focus on the reverse causality from poverty to informality, arising from a range of constraints that poverty poses to jobholders. Only recently have empirical researchers tried to study the simultaneous two-way relationship between poverty and informality. However, existing studies have relied upon cross-sectional data and static econometric models. This chapter takes the next step and studies the dynamics of poverty and informality using longitudinal data. Our empirical analysis is based on a bivariate dynamic random-effect probit model and recent panel data from Argentina. The method used provides a means of assessing the persistence over time of poverty and informal employment at the individual level, while controlling for both observed and unobserved determinants of the two processes. The results show that both poverty and informal employment are highly persistent processes. Moreover, positive spillover effects are found from past poverty on current informal employment and from past informality to current poverty status, corroborating the view that the two processes are also shaped by interrelated dynamics in segmented labor markets.

Low-Paid but Satisfied? How Immigrant and Ethnic Minority Workers in Low-Wage Jobs Make Sense of Their Wages

A ‘good job’ consists of the concepts of wages as an economic compensation, job status as a social status, and job satisfaction as a subjective psychological criterion, and it represents individual accomplishments in the labour market in regard to workers’ entire life (Bang and Lee, 2006). Job satisfaction in particular depends on objective working conditions as well as subjective factors (among others, Easterlin, 2001; Frey and Stutzer, 2002 for a review; Diener et al., 1999; Clark and Oswald, 1994, 1996; Poggi, 2010). As a rule, jobs characterised by low wages and low status are associated with a low level of job satisfaction (Eurofound, 2013b). However, this is not always the case.

Subjective Well-Being at the Workplace

It is largely acknowledged that individual well-being1 is only partially measured by objective indicators of quality of life such as those presented in the previous chapter of this book. They need to be complemented by subjective measures on satisfaction and happiness in order for a complete picture of people’s well-being to be presented.

Material Well-Being and Job Quality: Some Descriptive Statistics

Income, essential commodities and housing are undoubtedly some of the main components of quality of life, and are essential factors for participating in normal life. Effective integration into society and employment is dependent on meeting the basic needs of shelter, while having a good home is important for family life and social relationships. Generally, the living environment will profoundly affect other quality of life outcomes such as employment and health (Jencks and Mayer, 1990; Ellen and Turner, 1997, Lupton, 2001; Buck, 2000; Friedrichs, 1997; Power, 2000; Kain, 1968, 1992; Wilson, 1996). The basic idea is that the outcome of one’s life choices and opportunities might vary if one lived or grew up in a different area (perhaps with a higher concentration of poverty, deprivation and/or unemployment).