The analysis of poverty in Italy. A fuzzy dynamic approach

Abstract

The commonly used criterion to sharply separate the poor from the non poor on the basis of a poverty threshold appears to be too severe in comparison with the nature of poverty. The latter is multidimensional in its components (domain) and continue in its states (codomain). Moreover an income-based poverty line allows for a remarkable number of spurious transitions below and over that line, which do not correspond to true variations in household's standard of living. This study starts from the analysis of common (with crisp states) transition matrices; then a fuzzy multidimensional poverty indicator is built. In conclusion, fuzzy states transition matrices synthesize interpretative content of previously proposed instruments for the analysis of poverty