Accounting for trends in health poverty: a decomposition analysis for Britain, 1991-2008

We use data from the British Household Panel Survey to analyse changes in poverty of self-reported health from 1991 to 2008. We use the indices recently introduced by Bennett and Hatzimasoura (Poverty measurement with ordinal data. Institute for International Economic Policy, IIEP-WP-2011-14, 2011), which can be interpreted as ordinal counterparts of the classical Foster et al. (Econometrica 52(3):761-766, 1984) poverty measures. We decompose changes in self-reported health poverty over time into within-group health poverty changes and population shifts between groups. We also provide statistical inference for the Bennett and Hatzimasoura's (Poverty measurement with ordinal data. Institute for International Economic Policy, IIEP-WP-2011-14, 2011) indices. Results suggest that when "fair" self-reported health status is chosen as a health poverty threshold all of the used indices indicate the growth of health poverty in Britain. However, when the health poverty threshold is lower ("poor" self-reported health status) the increase in health poverty incidence was compensated by decreasing average health poverty depth and improving health inequality among those who are poor with respect to health. The subgroup decompositions suggest that the most important factors accounting for the changes in total health poverty in Britain include a rise of both health poverty and population shares of persons cohabiting and couples with no children as well as an increase of the population of retired persons.