Has Poverty in Croatia Been Really Stagnant?

Abstract

The main goal of the paper was to compare poverty rates in Croatia based on the EU poverty methodology (60% of median equivalent income) with alternative indicators of income poverty, material deprivation and subjective poverty. Together with poverty indicators referring to different dimensions of poverty, the cumulative approach to poverty was used, meaning that poverty was measured by combining more dimensions of poverty. The Household Budget Survey in the 2003–2008 period was used as a data source. All alternative poverty indicators, as well as cumulative poverty indicators, confirmed that the scope of poverty was significantly reduced in the 2003–2008 period (the rates of material deprivation were almost halved), being at odds with stagnant relative poverty rates (obtained according to the poverty line defined as 60% of median). There has been a lack of absolute overlap among poverty dimensions (measures), but dimensions are interrelated. Different poverty measures result in different poverty profiles. The paper has shown that it is necessary to use more poverty measures and cumulative approach in order to monitor poverty, because this way it is possible to identify much better not only the scope but also the depth of poverty.