Net equivalized household income

Using the ECHP and EU-SILC household survey data introduced in Chapter Four, I followed Eurostat standard practice and weighted household members by using the Eurostat and OECD equivalence scale. The scale assigns a weight to each household member and then adds the resulting figures to arrive at the equivalized household size: 1.0 to the first adult; 0.5 to the second adult and each subsequent person aged 14 and over; and 0.3 to each child under the age of 14 (see also Castells-Quintana et al, 2015).

Weights

Equivalized data on household income were used to calculate poverty and income inequality using cross-sectional household weights. The ‘design weights’ at the level of households were calculated by taking the inverse of each of the household inclusion probabilities (cf European Commission, 2010c). To aggregate this measure at the regional level, I used household weights and adjusted for price changes over time (cf Mack and Lange, 2015).

Poverty line

When running analyses at the NUTS level, the use of regionallevel poverty lines would provide a relative measure of poverty determined only by intra-regional income distribution, wholly independent of any regional disparities that might exist in the country. By contrast, using national-level poverty lines, which the EU typically defines as below 60 per cent of the national median income and uses to calculate such measures as risk of poverty (European Commission, 2010c, p. 12), would introduce an element of ‘absoluteness’ to the data, as the resulting poverty rate in a NUTS region would then depend on differences in income levels among NUTS regions either within the same country or within the EU. The ‘higher’ the geographical level at which the poverty line is expressed, the more relative the poverty measure becomes (cf Verma et al, 2006). To introduce elements of difference both within and across EU regions, I demarcated poverty lines at 60 per cent of the national median income, calculated separately for each state and year to factor in overall increases in living standards (cf Atkinson et al, 2002, p. 79).