Ricerc@Sapienza

The economic crisis engendered by the social distancing and lockdown measures implemented to limit the spread of COVID-19 contagions is expected to have strong consequences on income levels, in general, and on poverty diffusion, in particular. In absence of data on household income and living conditions at the times of pandemic, the application of microsimulation models on pre-pandemic survey data represents a valuable alternative to provide some insights on the impact of the COVID-19 outbreak and emergency benefits introduced on incomes of Italian households. In this research project, we aim to fill the gap existing in the literature on this topic by means of nowcasting procedures in order to improve hypotheses adopted in the microsimulation model and to make trends observed in pre-pandemic data in the labour market and the access to the welfare system more in line with the actual ones. This context of pandemic may however become an important opportunity of reflection on the methodology we use in Italy to define the absolute poverty phenomenon. In particular, the closure of shops and consequent limitations to individuals¿ consumption expenditure raised several doubts on the capability of a definition of poverty relying on the households¿ consumptions (as the absolute poverty does) of effectively identify the effects of the actual crisis on the levels of household wellbeing. Using a unique dataset merging the Household Budget Survey data and administrative records provided by the Italian Social Security Institute (INPS) and the Italian Ministry of Economics and Finance, we want to propose here a new and more reliable measurement of poverty, which improves the actual definition of absolute poverty and considers a potential combination of households¿ consumption expenditure with some elements of their income and wealth.