European experience in measuring poverty and social exclusion: AROPE index

Evolution of poverty measurement methodology is moving away from a monetary approach as the one and the only towards the extended technique that combines different definitions of poverty. One of the approaches is to combine monetary indicator (income poverty) and non-monetary poverty assessment through deprivations. This approach gave birth to a comparative methodology for assessing poverty and social exclusion (AROPE index) which was adopted by EU countries in 2010. According to the AROPE methodology, population at risk of poverty or social exclusion is defined as those who are poor in terms of income poverty, suffer severe deprivations or living in households with a very low work intensity among members of household in working age (or without the employed). Analysis of the AROPE index and its components for the EU countries shows their extreme heterogeneity in terms of this index. However, despite the criticism, the methodology will remain unchanged until 2020, so that poverty dynamics in EU countries can be studied. According to the Statistical Survey of Income and Participation in Social Programs conducted by the Russian Federal State Statistics Service (Rosstat), AROPE rate in Russia (2016) is slightly higher than in EU (2017) but the proximity of the AROPE rates in Russia and EU raises doubts about the adequacy of the real standard of living reflection through this index. In 2017, the European Commission decided to modify the part of AROPE methodology related to material deprivation evaluation by expanding the list of deprivations and excluding those household goods that are already included in the consumption standard in European countries.