Flash estimates on income distribution dynamics

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Presentation transcript:

Flash estimates on income distribution dynamics Workshop on best practices for EU-SILC revision, Paris 10th December 2015 Eurostat

Overall framework

Income component approach

Overview Update labour and demographics Uprating/ Income component approach Overview Update labour and demographics Reweight (LFS) Model transitions (LFS) use collected transitions in SILC Update income components National accounts Microsimulation ( Euromod) Microsimulation (MSs), SILC wage... Uprating/ adjustements HICP, LCI, macro-indicators... Current income No of recipients and level of different income components. These are then recomposed in an The quadrants in each column are not necessarily mutually exclusive, a combination National accounts uprating factors Microsimulation in euromod for implementing policies and taxes

- Objective for the European Semester FE income N in June N+1 Income component approach - Objective for the European Semester FE income N in June N+1 - FE and timeliness multi-year lag 2-year lag 1-year lag FE 2014 FE 2015 SILC 2012 (INC 2011) FE 2013 SILC 2013 (INC 2012) FE 2014 SILC 2014 (INC 2013) FE 2015 SILC 2012 (INC 2011) FE 2013 SILC 2014 (INC 2013) FE 2014 SILC 2015 (INC 2014) FE 2015 SILC 2013 (INC 2012) FE 2013

- Auxiliary sources: - Methodology LFS for labour/demographics changes Income component approach - Auxiliary sources: LFS for labour/demographics changes EUROMOD for social benefits and taxes Update for other income components: NA Other national sources? - Methodology Consistency issues: labour for SILC-LFS; property and self-employment income not in line with NA Reweighting/modelling Euromod and national simulation models Correct for "model error"

Parametric Estimation of the Income Distribution

Empirical income distribution

Fitting a Generalized Beta Distribution of the Second Kind (GB2) using the GB2 R package (Graf & Nedyalkova)

GB2 parameters a: shape b: central value p, q: tails

Parameter nowcasting (1) Clear and strong trend, no correlation with macro variables  trend extrapolation (2) No clear trend, strong correlation with macro variables  econometric modeling, using observed macro data

GB2 parameters  Monetary Laeken Indicators q at-risk-of poverty threshold at-risk-of-poverty rate relative median at-risk-of-poverty gap income quintile share ratio + Gini coefficient using the GB2 package

Current income approach

Current income approach 16 MS collect information in 2014/2015: - Eurostat level: centralised analysis of methods and results - National level: 5 countries- grants for flash estimates based on current income (to be finished October 2016) Call for proposals for further actions (1st half 2016)

Timeline 2016-2020 2016 Produce FE 2015: by June 2016 joint delivery of Eurostat & Euromod (EU-SILC 2012 (inc 2011) & 2014 (inc 2013) Tests the parametric approach & current income Call for proposals TF on Flash Estimates

Timeline 2016-2020 2017 Publish FE 2016: by June 2017 joint delivery of Eurostat & Euromod ((EU-SILC 2015 (inc 2014)) 2020 Publish FE 2019: by June 2020 joint delivery of Eurostat & Euromod (EU-SILC 2019 (inc 2018))