A multidimensional approach to measuring economic insecurity: the case of Chile

Prieto Suarez, Joaquin (2022) A multidimensional approach to measuring economic insecurity: the case of Chile. Social Indicators Research, 163 (2). 823 - 855. ISSN 0303-8300

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Abstract

This paper proposes a strategy to measure economic insecurity in countries in the Global South. It builds a 'Multidimensional Economic Insecurity Index' (MEII) that combines four indicators of economic vulnerability that cause stress and anxiety: unexpected economic shocks, unprotected employment or non-workers in the household, over-indebtedness and asset poverty. The index offers a measure that directly relates economic uncertainty to stress and anxiety due to the lack of protection and buffers to face an unexpected economic shock. The MEII is applied to Chile using Survey of Household Finances (SHF) cross-sectional data (2007, 2011, 2014 and 2017). The results show that (i) about half of the Chilean households experienced, on average, two or more economic vulnerabilities during the last decade with an intensity of 2.3 vulnerabilities, and (ii) economic insecurity affects households on the entire income distribution, even in the highest income deciles groups. By identifying the groups of households most affected by economic insecurity and its trend in recent years, applying the MEII in countries such as Chile provides relevant information to monitor, evaluate and improve social safety nets besides labour market regulations.

Item Type:	Article
Official URL:	https://www.springer.com/journal/11205
Additional Information:	© 2022 The Author
Divisions:	International Inequalities Institute
Subjects:	H Social Sciences > HB Economic Theory H Social Sciences > HC Economic History and Conditions
JEL classification:	D - Microeconomics > D6 - Welfare Economics > D63 - Equity, Justice, Inequality, and Other Normative Criteria and Measurement I - Health, Education, and Welfare > I3 - Welfare and Poverty > I31 - General Welfare; Basic Needs; Living Standards; Quality of Life; Happiness
Date Deposited:	08 Apr 2022 10:09
Last Modified:	12 Dec 2024 02:57
URI:	http://eprints.lse.ac.uk/id/eprint/114623

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