Poverty in Ireland, 1987-1994: a stochastic dominance approach

Abstract

Poverty dominance analysis uses stochastic dominance to provide rankings of distributions in terms of poverty which are not sensitive to the choice of poverty line. This analysis is carried out for Ireland using Household Budget Survey data for 1987 and 1994 including tests for the statistical significance of the results. We find that for a wide range of absolute poverty lines, poverty in Ireland fell over the 1987-1994 period. When relative poverty lines are used, second-order dominance for 1987 over 1994 is found for the case of expenditure and third-order dominance for 1994 over 1987 for the case of income.