The importance of consecutive spells of poverty: a longitudinal poverty index

Traditional measures of poverty persistence, such as ’poverty rate’ (i.e., the number of years spentin poverty upon the total number of observations) or the ’persistent-risk-of-poverty rate’, do not devote enoughattention to the sequence of poverty spells. In particular, they are insufficient in underlining the different effectsassociated with occasional single spells of poverty and the consecutive years of poverty. Here, we propose a newindex which measures the severity of poverty, taking into account the way poverty and non-poverty spells follow oneanother along individual life courses. The index is normalized and increases with the number of consecutive years inpoverty along the sequence, while the index decreases when the distance between two years of poverty increases.All the years spent in poverty concur with the measurement of the persistency in poverty but with a decreasingcontribution as long as the distance between two years of poverty become longer. A weighted version of the indexis also proposed, explicitly taking the distance from the poverty line of poor people into account. Both the indexes aresupported by a conceptual framework and characterised via properties and axioms. They are validated accordingto content, construct and criterion validity assessment and tested on a sample drawn from young European adultsparticipating in European Community Households Panel survey.