The Levy Institute Measure of Time and Income PovertyIn addition to income inadequacies, the Levy Institute’s innovative Measure of Time and Income Poverty (LIMTIP) accounts for, and hence makes visible, the negative impact time deficits exert on living standards.
Income poverty customarily ascertains the ability of individuals and households to gain access to some minimal level of income (i.e., the poverty line), on the premise that such access ensures the fulfillment of a designated set of basic material needs. However, this approach neglects the fact that, in addition to a minimal basket of market purchases, daily reproduction of household members requires that some amount of time must be dedicated to necessary (unpaid) household production activities. Just as some households fail to gain access to sufficient income, we must also consider the possibility that households may fail to meet their basic household production requirements for lack of time. Time deficits may be so severe that, when accounted for, they bring to the fore households that are in fact in poverty but remain “hidden” from the policy radar.
Furthermore, LIMTIP builds on the supposition that, within the household, women and men do not partake equally in meeting household production requirements, nor do they face identical time deficits: existing data reveal that women contribute their time disproportionately to unpaid household activities. Accordingly, to assess inequalities between households and among individuals within households requires that we consider differentiation jointly across both income and household production dimensions. For that, it is imperative to understand how labor force participation and earnings interact with time dedicated to household production responsibilities. Such an understanding is particularly important for formulating policies that promote gender, social, and economic justice coherently and consistently.
In addition to providing a measurement framework that allows a better informed estimation of poverty rates and depth of poverty we employ a microsimulation model that is especially useful for policy impact analysis. Designed to track both income and time dimensions of inequalities, it can be used to evaluate the effectiveness of a policy intervention (or an economic event) in reduction of time and income poverty simultaneously.
The support of the United Nations Development Programme Regional Service Centre for Latin America and the Caribbean, particularly the Gender Practice, Poverty, and Millennium Development Goals areas, made the development of this framework possible.
Research Project Reports | August 2018
The Levy Institute Measure of Time and Consumption PovertyTime constraints that stem from the overlapping domains of paid and unpaid work are of central concern to the debates surrounding the economic development of developing countries in general and countries of sub-Saharan Africa in particular. Time deficits due to household production are especially acute in these countries due to the poor state of social and physical infrastructure, which constrains the time allocation people can choose.
Standard measures of poverty fail to capture hardships caused by time deficits. This report applies a methodological approach that incorporates time deficits into the measurement of poverty, known as the Levy Institute Measure of Time and Consumption Poverty (LIMTCP), to the cases of Ghana and Tanzania. The LIMTCP explicitly recognizes the role of time constraints and, as such, has the potential to meaningfully inform the design of policies aimed at poverty reduction and improvement of individual and household well-being. The analysis of simulation exercises assessing the impact of paid employment provision on official and LIMTCP poverty rates has strong implications for policies aimed at poverty reduction, emphasizing the need to account for alleviating not only income but also time constraints. It also has strong gender relevance, as time poverty is more relevant for women due to their disproportionate burden of household responsibilities. Our study argues that policies aimed at improving women’s labor market outcomes can also succeed at improving their well-being only if time constraints are addressed.Download:Associated Program:Author(s):Related Topic(s):
Policy Note 2018/4 | May 2018
Some Lessons from Ghana and TanzaniaIn this policy note, Thomas Masterson and Ajit Zacharias address the nexus between wage employment, consumption poverty, and time deficits in the context of Ghana and Tanzania. Based on a recently completed research project supported by the Hewlett Foundation, the authors apply the Levy Institute Measure of Time and Consumption Poverty (LIMTCP) to estimate whether the jobs that are likely to be available to potential employment-seeking, working-age individuals in consumption-poor households—who are predominantly female in both countries—can serve as vehicles of “economic empowerment.” They investigate this question using two indicators of empowerment, asking (1) whether the individual would be able to move their household to at least a minimal level of consumption via the additional earnings from their new job and (2) whether the individual would be deprived of the time required to meet the minimal needs of care for themselves (personal care), their homes, and their dependents.Download:Associated Program(s):Author(s):Related Topic(s):
Policy Note 2017/4 | November 2017The predominant framework for measuring poverty rests on an implicit assumption that everyone has enough time available to devote to household production or enough resources to compensate for deficits in household production by purchasing market substitutes. Senior Scholar Ajit Zacharias argues that this implicit bias in our official poverty statistics threatens to undermine the Sustainable Development Goals (SDGs).
The SDGs include the following targets: (1) reduce the incidence of poverty by 50 percent by 2030, and (2) recognize and provide support to the unpaid provision of domestic services and care of persons undertaken predominantly by women in their households. This policy note suggests that a closer link exists between poverty reduction and support for household production activities than is commonly acknowledged. Failure to recognize the link in policy design can contribute to failure on both fronts. To obtain a more accurate assessment of poverty, time deficits in household production must be taken into account.
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Working Paper No. 873 | September 2016
This document presents a description of the quality of match of the statistical matches used in the LIMTCP estimates prepared for Ghana and Tanzania. For Ghana, the statistical match combines the Living Standards Survey Round 6 (GLSS6) with the Ghana Time Use Survey (GTUS) 2009, and for Tanzania it combines the Household Budget Survey (THBS) 2012 with the time-use data obtained from the Integrated Labor Survey Module (ILFS) 2006. In both cases, the alignment of the two datasets is examined, after which various aspects of the match quality are described. Despite the differences in the survey years, the quality of match is high and the synthetic dataset appropriate for the time poverty analysis.Download:Associated Program(s):Author(s):Related Topic(s):
Working Paper No. 871 | August 2016
New methodology for producing employment microsimulations is introduced, with a focus on farms and household nonfarm enterprises. Previous simulations have not dealt with the issue of reduced production in farm and nonfarm household enterprises when household members are placed in paid employment. In this paper, we present a method for addressing the tradeoff between paid employment and the farm and nonfarm business activities individuals may already be engaged in. The implementation of the simulations for Ghana and Tanzania is described and the quality of the simulation results is assessed.Download:Associated Program(s):Author(s):Related Topic(s):
Working Paper No. 865 | May 2016
Why Time Deficits Matter
We describe the production of estimates of the Levy Institute Measure of Time and Income Poverty (LIMTIP) for Buenos Aires, Argentina, and use it to analyze the incidence of time and income poverty. We find high numbers of hidden poor—those who are not poor according to the official measure but are found to be poor when using our time-adjusted poverty line. Large time deficits for those living just above the official poverty line are the reason for this hidden poverty. Time deficits are unevenly distributed by employment status, family type, and especially gender. Simulations of the impact of full-time employment on those households with nonworking (for pay) adults indicate that reductions in income poverty can be achieved, but at the cost of increased time poverty. Policy interventions that address the lack of both income and time are discussed.Download:Associated Program(s):The Distribution of Income and Wealth Gender Equality and the Economy The Levy Institute Measure of Time and Income PovertyAuthor(s):Related Topic(s):
Research Project Reports | August 2014
The Levy Institute Measure of Time and Income PovertyThis report presents findings from a joint project of the Levy Economics Institute and the Korea Employment Information Service, with the central objective of developing a measure of time and income poverty for Korea that takes into account household production (unpaid work) requirements. Standard measurements of poverty assume that all households have enough time to adequately attend to the needs of household members—including, for example, caring for children. But this assumption is false. For numerous reasons, some households may not have sufficient time, and they thus experience “time deficits.” If a household officially classified as nonpoor has such a time deficit and cannot afford to cover it by buying market substitutes (e.g., hiring a care provider), that household will encounter hardships not reflected in the official poverty measure. To get a more accurate calculus of poverty, we developed the Levy Institute Measure of Time and Income Poverty (LIMTIP), a two-dimensional measure that takes into account both the necessary income and the household production time needed to achieve a minimum living standard. In the case of Korea, our estimates for 2008 (the last year for which data are available) show that the LIMTIP poverty rate of employed households was almost three times higher than the official poverty rate (7.5 percent versus 2.6 percent). The gap between the official and LIMTIP poverty rates was notably higher for “nonemployed male head with employed spouse,” “single female-headed” and “dual-earner” households. Our estimates of the size of the hidden poor—roughly two million individuals—suggest that ignoring time deficits in household production resulted in a serious undercount of the working poor, which has profound consequences for the formulation of policy. In addition, the stark gender disparity in the incidence of time poverty among the employed, even after controlling for hours of employment, suggests that the source of the gender difference in time poverty lies in the greater share of the household production activities that women undertake. Overall, current policies to promote gender equality and economic well-being in Korea need to be reconsidered, based on a deeper understanding of the linkages between the functioning of labor markets, unpaid household production activities, and existing arrangements of social provisioning—including social care provisioning.Download:Associated Program(s):The Distribution of Income and Wealth Gender Equality and the Economy The Levy Institute Measure of Time and Income PovertyAuthor(s):Related Topic(s):
Public Policy Brief No. 136 | August 2014
Assessing the Korean Experience Using the Levy Institute Measure of Time and Income PovertyIn partnership with the Korea Employment Information Service, Senior Scholar Ajit Zacharias and Research Scholars Thomas Masterson and Kijong Kim investigate the complex issues of gender, changing labor market conditions, and the public provisioning of child care in Korea using the Levy Institute Measure of Time and Income Poverty (LIMTIP), an alternative measure that factors in both time and income deficits in the assessment of poverty. Since the 1997 Asian financial crisis, lifetime employment and single-breadwinner households have given way to increased job insecurity, flexible work arrangements, and rapid growth in dual-earner households in Korea. Add to these factors rising labor force participation by women but little change in the highly unequal division of household production, and many women effectively face a double shift each day: paid employment followed by a second shift of household production. Recognizing the implications of the heavy burden of care work for women’s well-being and employment, Korea introduced public child-care provisioning, via a voucher system for low-income families, in 1992 (the program became universal in 2013). This study analyzes the impact of the voucher program on reducing time and income poverty, and reassesses the overall level of poverty in Korea. While it reveals a much higher level of poverty than official estimates indicate—7.9 percent versus 2.6 percent—due to time deficits, the outsourcing of child-care services reduced the LIMTIP rate from 7.9 percent to 7.5 percent and the number of “hidden poor” individuals from two million to 1.8 million. While these results show that the problem of time poverty in Korea extends beyond child-care needs, the impact of public provisioning through the voucher program clearly has had a positive impact on families with children. The main findings and policy recommendations resulting from this study are presented in detail in the research project report The Measurement of Time and Income Poverty in Korea: The Levy Institute Measure of Time and Income Poverty.Download:Associated Program(s):The Distribution of Income and Wealth Gender Equality and the Economy The Levy Institute Measure of Time and Income PovertyAuthor(s):Related Topic(s):
Press Releases | May 2014
Download:Associated Program(s):Author(s):Mark Primoff
Public Policy Brief No. 132 | May 2014Gauging the severity of poverty in a given country requires a reasonably comprehensive measurement of whether individuals and households are surpassing some basic threshold of material well-being. This would seem to be an obvious point, and yet, in most cases, our official poverty metrics fail that test, often due to a crucial omission. In this policy brief, Senior Scholar Ajit Zacharias, Research Scholar Thomas Masterson, and Research Associate Emel Memiş present an alternative measure of poverty for Turkey and lay out the policy lessons that follow. Their research reveals that the number of people living in poverty and the severity of their deprivation have been significantly underestimated. This report is part of an ongoing Levy Institute project on time poverty (the Levy Institute Measure of Time and Income Poverty), which has produced research on Latin America, Korea, and now Turkey, with the aim of extending this approach to other countries.Download:Associated Program(s):Author(s):Related Topic(s):