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**The 2011 Pobal HP Deprivation Index for Small Areas (SA) Statistical Features**

Dublin, August 2012

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**Introduction to The 2011 Pobal HP Deprivation Index**

This presentation highlights some of the more technical issues in the construction of the and 2011 Pobal HP Deprivation Index for Small Areas (SA) and is aimed at the more statistically-minded reader. At the level of the individual indicator variables, the presentation includes: The transformation of the 2006 indicator variables The transformation of the 2011 indicator variables A comparison of the 2006 and 2011 indicator variables At the level of the new Pobal HP Deprivation Index, the presentation includes: The change in the Absolute Index Scores The change in the Relative Index Scores

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**The Underlying Dimensions of Social Disadvantage**

Demographic Decline (predominantly rural) population loss and the social and demographic effects of emigration (age dependency, low education of adult population) Social Class Deprivation (applying in rural and urban areas) social class composition, education, housing quality Labour Market Deprivation (predominantly urban) unemployment, lone parents, low skills base

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**Pobal HP Deprivation Index**

Basic Model of the Pobal HP Deprivation Index d Age Dependency Rate 1 Demographic d Population Change Growth 2 d Primary Education only 3 d Third Level Education 4 d Persons per Room 5 Social Class Composition d Professional Classes 6 d Semi- and Unskilled Classes 7 d Lone Parents 8 Labour Market d Male Unemployment Rate Situation 9 d Female Unemployment Rate 10

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**The Transformation of Indicator Variables**

When deriving composite indicators for multi-dimensional concepts, like deprivation, it is common practice to transform the individual indicator variables to normalise their distribution prior to model estimation The most common transformations include: truncation - to avoid the undue influence of extreme outliers zero-centering – to eliminate unwanted trend influences logarithmic – to normalise a skewed distribution The transformation of scaled variables does not affect the order of observations The overall emphasis on deriving true measures for the composite index as a distance from the mean is thereby maintained, whilst avoiding that this is unduly influenced by a small number of extreme observations

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**Population change (SA)**

Transformation: truncated at ±60% 2006 Before Mean: 12.0 STD: 29.1 Skew: 4.3 Kurtosis: 34.9 After Mean: 9.9 STD: 20.1 Skew: 1.3 Kurtosis: .8 2011 Before Mean: 48.9 STD: Skew: 34.8 Kurtosis: 1527 After Mean: 7.6 STD: 21.2 Skew: 1.0 Kurtosis: 1.0 Comparison of 2006 and 2011 r = 0.39 n = 18,246

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**Age dependency Rate (SA)**

Transformation: truncated at 70% 2006 Before Mean: 31.1 STD: 8.8 Skew: Kurtosis: 3.0 After Mean: 31.1 STD: 8.7 Skew: Kurtosis: 1.6 2011 Before Mean: 32.7 STD: 8.2 Skew: Kurtosis: 1.9 After Mean: 32.7 STD: 8.2 Skew: Kurtosis: 1.8 Comparison of 2006 and 2011 r = 0.75 n = 18,246

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**Lone Parent Rate (SA) Transformation: natural log**

2006 Before Mean: 20.9 STD: 17.5 Skew: 1.3 Kurtosis: 1.8 After Mean: 3.3 STD: .54 Skew: 0.07 Kurtosis: -0.6 2011 Before Mean: 21.5 STD: 16.5 Skew: 1.2 Kurtosis: 1.4 After Mean: 3.3 STD: 0.51 Skew: 0.01 Kurtosis: -0.5 Comparison of 2006 and 2011 r = 0.61 n = 18,246

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**Primary Education Only (SA)**

Transformation: zero-centred – natural log 2006 Before Mean: 18.7 STD: 12.1 Skew: 0.7 Kurtosis: 0.7 After Mean: 3.6 STD: 0.3 Skew: 0.02 Kurtosis: -0.7 2011 Before Mean: 16.0 STD: 10.7 Skew: 0.8 Kurtosis: 0.5 After Mean: 3.7 STD: 0.3 Skew: 0.2 Kurtosis: -0.6 Comparison of 2006 and 2011 r = 0.90 n = 18,246

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**Third Level Education (SA)**

Transformation: zero-centred – natural log 2006 Before Mean: 30.9 STD: 16.8 Skew: 0.9 Kurtosis: 0.4 After Mean: 3.6 STD: 0.4 Skew: Kurtosis: -0.14 2011 Before Mean: 30.7 STD: 16.6 Skew: Kurtosis: 0.47 After Mean: 3.6 STD: 0.4 Skew: Kurtosis: -0.12 Comparison of 2006 and 2011 r = 0.90 n = 18,246

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**Higher and Lower Professionals (SA)**

Transformation: none 2006 Before Mean: 32.9 STD: 15.0 Skew: 0.4 Kurtosis: -0.04 After Mean: STD: Skew: Kurtosis: 2011 Before Mean: 34.1 STD: 15.2 Skew: 0.4 Kurtosis: -0.14 Comparison of 2006 and 2011 r = 0.89 n = 18,246

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**Semi- and Unskilled Social Classes (SA)**

Transformation: natural log 2006 Before Mean: 19.4 STD: 10.6 Skew: 0.8 Kurtosis: 1.2 After Mean: 3.2 STD: 0.4 Skew: -0.3 Kurtosis: 0.0 2011 Before Mean: 18.6 STD: 9.8 Skew: 0.7 Kurtosis: 0.5 After Mean: 3.2 STD: 0.4 Skew: -0.3 Kurtosis: -0.1 Comparison of 2006 and 2011 r = 0.81 n = 18,246

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**Male Unemployment rate (SA)**

Transformation: natural log 2006 Before Mean: 9.1 STD: 8.4 Skew: 2.4 Kurtosis: 11.0 After Mean: 2.3 STD: 0.6 Skew: 0.2 Kurtosis: -0.1 2011 Before Mean: 23.1 STD: 12.7 Skew: 1.1 Kurtosis: 1.1 After Mean: 3.1 STD: 0.5 Skew: -0.3 Kurtosis: 0.2 Comparison of 2006 and 2011 r = 0.62 n = 18,246

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**Female Unemployment Rate (SA)**

Transformation: natural log 2006 Before Mean: 8.3 STD: 7.3 Skew: 2.1 Kurtosis: 10.1 After Mean: 2.2 STD: 0.6 Skew: -0.1 Kurtosis: -0.3 2011 Before Mean: 15.5 STD: 9.5 Skew: 1.3 Kurtosis: 2.3 After Mean: 2.8 STD: 0.5 Skew: -0.3 Kurtosis: 0.3 Comparison of 2006 and 2011 r = 0.51 n = 18,246

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**Average Number of Persons per Room (SA)**

Transformation: truncated – natural log 2006 Before Mean: 0.51 STD: 0.09 Skew: 1.4 Kurtosis: 6.4 After Mean: STD: 0.16 Skew: 0.5 Kurtosis: 0.7 2011 Before Mean: 0.51 STD: 0.18 Skew: 20.2 Kurtosis: 854 After Mean: STD: 0.17 Skew: 0.7 Kurtosis: 0.3 Comparison of 2006 and 2011 r = 0.70 n = 18,246

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**Comparison of 2006 and 2011 Absolute Index Scores**

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**Comparison of 2006 and 2011 relative Index Scores**

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