Implications of Income Pooling and Household Decision-making for the Measurement of Poverty and Deprivation: An Analysis of the SILC 2010 Special Module for Ireland

October 23, 2013 |

Authors: Dorothy Watson , Bertrand Maître , Sara Cantillon
Social Inclusion Technical Paper No. 4

A core assumption in conventional poverty measurement is that income is shared within households to the benefit of all household members. This technical paper draws on the 2010 Irish SILC module to examine aspects of the household?s financial regime, including which household members receive income, the extent to which income is contributed for the benefit of other household members and responsibility for decision-making. The paper finds only small differences in income pooling by gender, but large differences by the person’s position in the household. In terms of decision-making, we find that most couples share responsibility for decisions. Among the findings regarding the consequences of household financial regime (with income and other characteristics controlled) were the beneficial impact of having income from work and of shared responsibility for decisions. Contrary to expectations, variations in the proportion of income contributed for the benefit of other household members did not have the anticipated impact on household and individual deprivation. The paper concludes by pointing to some implications for the measurement of poverty.

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