Ricerc@Sapienza

This research project aims at evaluating the effects of covid-19 on economic inequality, with particular reference to European households before the lockdown, during the containment period and after the post-lockdown rebound. Attention is paid to the evaluation of the effectiveness of recovery funds and how successful are public policies in reducing poverty and inequality among European households. The term evaluation refers here to the normative assessment of public policy activities, from a ex-post viewpoint.
In order to pursue this goal longitudinal data are needed, as well as new tools to evaluate the effects of a public policy on the entire distribution rather than the effects on average incomes.

Income inequality estimation, usually measured through Lorenz curve and Gini concentration index, requires households microdata. The evaluation of the success of a public policy in reducing inequality requires, in addition, longitudinal data since same households should be followed over time. Longitudinal data allow to estimate household income distribution before and after the public policy (i.e. recovery funds).

The reference source for this evaluation exercise is the European Union (EU) Survey on Income and Living Conditions (SILC), in its longitudinal component. Starting from the pre-pandemic wave (2019), continuing analyzing the 2020 households data and finally looking at the successive waves (post-pandemic period), the project evaluates the effects of the policy. Data are confidential, but members of the research team are part of an approved project for using these data (2019 - 2024).
In terms of new statistical method, the project extends the traditional Average Treatment Effect approach. The novelty in the methodology lies in the possibility of comparing two entire distributions instead of two average values. Therefore, Gini concentration indx and Lorenz curve for treated (after the policy) and untreated (before the policy) households can be studied.