1. www.statistik.at We provide information Model based estimation of indicators of poverty and social exclusion Thomas Glaser Statistics Austria Directorate Social Statistics European Conference on Quality in official Statistics 5 th June 2014

2. www.statistik.at slide 2 | 5 th June 2014 Overview o Europe 2020 indicators: Break in time series o Data basis for modelling: EU-SILC 2011 o Different modelling variants o Application of modelled register data effect to EU-SILC 2008-2010 o Conclusions and outlook

3. www.statistik.at slide 3 | 5 th June 2014 Register based household income o Usage of register from EU-SILC 2012 onwards o Results in a break in time series for income based Europe 2020 indicators o At-risk-of-poverty: AROP (REG) o At-risk-of-poverty or social exclusion: AROPE (REG) o Data from income registers also available for EU-SILC 2011 o Revision of time series 2008-2012 desired o No income register data for 2008-2010 available yet o Model based register household income as solution

4. www.statistik.at slide 4 | 5 th June 2014 Choice of models: Variant 1 o Direct estimation of indicators o Likelihood of AROP (REG) and AROPE (REG) estimated by logistic regressions o Estimate of indicators: mean value of estimated probabilities on personal level o Advantage: o Direct estimation of indicators o Disadvantages: o Possibility of inconsistent estimates of indicators o Only moderate model fit o Underestimation of AROP (REG) and AROPE (REG)

5. www.statistik.at slide 5 | 5 th June 2014 Choice of models: Variant 2 o Estimation of register based household income HINC (REG) o Linear regression: Natural log of HINC (REG) as dependent variable o Estimation of indicators o Equivalised income from with interview based data o Calculation of AROP (REG) and AROPE (REG) o Advantages: o Consistent indicators o Estimates of household income on sample level o Very good model fit (R 2 =89%) o Disadvantages: o Loss of variance due to regression o Underestimation of AROP (REG) and AROPE (REG)

6. www.statistik.at slide 6 | 5 th June 2014 Choice of models: Variant 2a o Addition of iid N(0,σ 2 ) stochastic error terms to estimates resulting from linear regression in variant 2 o Advantages: o Compensation of tendency towards the mean o Estimated HINC (REG) distribution similar to HINC (REG) o Estimates close to actual AROP (REG) and AROPE (REG) (EU-SILC 2011) o Disadvantage: o Additional variance contains no additional information on structure of household income

7. www.statistik.at slide 7 | 5 th June 2014 Choice of models: Variant 3 o Estimation of difference HINC - HINC (REG) o Two step modelling o 1) Classification of relevant difference (discriminant analysis) o 2) Linear regression similar to variant 2 for difference o Estimated difference is added to HINC o Advantages: o Explicit estimation of register data effect o Disadvantages: o Overestimation of AROP (REG) and AROPE (REG) o Low model fit o Errors of two modelling steps

8. www.statistik.at slide 8 | 5 th June 2014 Weighting o Calibration incorporates register income data o Additional modelling step for estimated weights in every variant would be necessary o All models fitted without weights o Characteristics relevant for weighting are also predictors in the models o Marginal differences weighted – unweighted o OLS most efficient for linear regression

9. www.statistik.at slide 9 | 5 th June 2014 Chosen model o Variant 2a: Estimation of register based household income including iid N(0,σ 2 ) stochastic error terms o More advantages than disadvantages o Easy application o Coefficients from regression and stochastic error terms were applied to interview based data of EU-SILC 2008-2010 o Socio-economic structure reflected in predictor variables for each year can be incorporated in estimation

10. www.statistik.at slide 10 | 5 th June 2014 Register and interview based time series

11. www.statistik.at slide 11 | 5 th June 2014 Conclusions and outlook o Unbroken time series of Europe 2020 indicators for EU-SILC 2008-2012 achieved o Europe 2020 targets can be measured from 2008 onwards with register based indicators o Next task: recalculation of register based household income for EU-SILC 2008-2010 o Revision of EU-SILC micro-data 2008-2011 until 09/2014 o Publication of revised time-series 2008-2013 in autumn/winter 2014

12. www.statistik.at slide 12 | 5 th June 2014 Please address queries to: Thomas Glaser thomas.glaser@statistik.gv.at Contact information: Guglgasse 13, 1110 Vienna Thank you for your attention!