Dependent Variables: Measures of Economic Vulnerability

The concepts underlying the three indicators of economic vulnerability has already been discussed at considerable length in the theoretical part. In the following sec-tions, the focus will therefore be on the specificity of operationalizing these mea-sures with VLV data. A general word to the implications of the methodological choice to use binary indicators for measuring economic vulnerability is in order. As argued previously, we believe that, at the individual level, there is an absolute core to experimental economic vulnerability. The challenge now is to capture this thresh-old for the two subjective measures and this endeavor promises to be more success-ful, if the survey question provides an inbuilt threshold. In the case the self-assessed difficulties in making ends meet, we can suppose such an underlying dichotomy, indicated by the wording of the response items; the perceived worries about not hav-ing enough money, on the other hand, does not allow such an assumption. The questionable relevance of forcing all individuals into two income groups from the

perspective of the classified individual was one of our main reservations regarding the use of the monetary indicator, though we admit that it is relevant from a societal point of view. For the purpose of operationalizing the vulnerability typology, we are required to use binary measures; otherwise, the number of categories would explode as a result of all the combinations that are possible between three measures, each with several items. Combining the three binary measures into one is an attempt to preserve and interpret information that is lost if one looks at economic vulnerability through the lens of just one binary indicator. In order to prevent the loss of informa-tion, binary analysis among the three measures of economic vulnerability and between them and each of the independent variables will be performed using the original survey items, before dichotomization. This allows having a more precise measure of the strength of the association between each pair of variables; moreover, it prevents us from underestimating the variability in outcomes between groups and from overlooking non-linearity in the relationship between the variables (Altman and Royston 2006).

The Objective Measure of economic vulnerability (obj_ev) consists of an abso-lute poverty line based on the recommendations by the Swiss Conference for Public Welfare (CSIAS/SKOS). For the year 2010, the threshold was at CHF 2450.- per adult equivalent¹ (SKOS 2013). Household income being a categorical variable in the VLV questionnaire,² we recoded all responses in the lowest two categories (less than CHF1200/between CHF 1200 and 2400.-) as income poor after accounting for household size. Household equivalence was calculated based on the OECD scale.³ The question was asked in a face-to-face interview setting, several interview tech-niques were applied in order to encourage a response to this delicate question:

respondents were shown the nine income categories on a show card and asked to indicate which one most closely corresponded to their average monthly household income.⁴ If respondents were very hesitant they were allowed to tick the box on the computer screen themselves so that the interviewer was kept from seeing their response. In the end, the percentage of respondents who chose not to answer this question was 14.5%, corresponding very closely to the proportion of nonresponse

1 In January 2014, the most up-to-date recommendations available from CSIAS/SKOS are based on data from 2010.

2 The scale consists of the following income categories: ‘Less than 1200 CHF’/‘Between 1200 and 2400 CHF’/‘Between 2400 and 3600 CHF’/‘Between 3600 and 4800 CHF’/‘Between 4800 and 6000 CHF’/‘Between 6000 and 7200 CHF’/‘Between 7200 and 10000 CHF’/‘Between 10000 and 10000 CHF’/‘More than 15000 CHF’

3 The OECD scale attributes a factor of 1 to the first adult in a given household and a factor of 0,5 for each additional adult. The OECD scale is among the most widely used equivalence scales.

Given the categorical nature of our data on monthly income, this scale was more adapted than more fine-tuned versions of equivalence scales.

4 The wording in the original questionnaire was as follows, in German and in French:

German:’ Aufgrund des Einkommensmassstabes, den ich Ihnen zeigen werde, können Sie mir sagen, was das monatliche Brutoeinkommen Ihres Haushaltes ist?’

French: ‘Sur la base de l’échelle de revenus que je vais vous énoncer, pouvez-vous me dire à com-bien se monte le revenu mensuel total brut de votre ménage?’

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recorded in the 2nd wave (1994) of the survey (Lalive d’Epinay and Hofstetter- Bétemps 1999, p. 93).

The Self-Assessed Measure of economic vulnerability (sa_ev) is based on the following question: ‘Thinking of your household’s total monthly income, would you say that you are able to make ends meet?’⁵ The response scale consists of four categories: with great difficulties, with some difficulties, quite easily, easily. This question was placed immediately after the question on income and wealth in the face-to-face interview. In order to obtain a binary variable, the response items were recoded into 1 representing vulnerable respondents (‘with great difficulties’ and

‘with some difficulties’) and 0 for non-vulnerable respondents (‘easily’ and ‘very easily). Thus, the Self-Asssessed Measure meets the desired requirement of provid-ing an inbuilt qualitative cut-point (see p. 34).

The Perceived Measure of economic vulnerability (perc_ev) was constructed using one item out of a set of questions on different sources of worry: ‘To what degree do the following situations worry you today? – Not having enough money to pay for current expenses, for example for bills, rent or food.’⁶ The response scale proposed five degrees of preoccupation: this doesn’t worry me at all, this worries me a bit, this worries me somewhat, this worries me strongly, this does not concern me.

The two subjective measures found in the VLV-survey are ideal for the purpose of assessing whether it makes sense to distinguish the self-assessed and the perceived dimension with regard to economic vulnerability because, while the question on financial worries taps into the emotional dimension of economic vulnerability, both survey items explicitly ask respondent to focus on the current financial situation (as opposed to a long-term perspective on provisions), and on the ability to cover basic needs, suggesting (or positing, in the case of sa_ev) that the frame of reference is to be their monthly household budget. Traditionally, the study of worries has been associated with anxiety, depression and general psychosomatic syndroms (Spielberger u. a. 1980). More recently, a non-clinical literature has emerged, con-veying an understanding of worries that is no longer dominated by a pathological view. Some types of worries may even be associated with positive mental health,

5 The wording in the original French questionnaire was as follows, in German and in French:

German:‚Würden Sie sagen, dass Sie mit Ihrem monatlichen Haushaltseinkommen über die Runden kommen? Sehr schwer, Ziemlich schwer, Ziemlich einfach, Einfach’

French:,Compte tenu du revenu mensuel de votre ménage, diriez-vous que vous arrivez à joindre les deux bouts: Très difficilement, Assez difficilement, Assez facilement, Facilement’

6 The wording in the original questionnaire was as follows, in German and in French:

German:‚In welchem Ausmass belasten Sie die folgenden Situationen heute? Nicht über genügend Geld zu verfügen, um die laufenden Kosten zu begleichen, z.B. Rechnungen, die Miete und Nahrungsmittel zu bezahlen: Überhaupt nicht, Ein wenig, Ziemlich, Stark, Trifft nicht zu’

French:‚Dans quelle mesure les situations suivantes constituent-elles une préoccupation pour vous aujourd’hui? Ne pas avoir suffisamment d’argent pour couvrir les dépenses courantes, par exemple pour payer les factures, le loyer ou la nourriture: Cela ne me préoccupe pas du tout, Cela me préoccupe un peu, Cela me préoccupe assez, Cela me préoccupe fortement, Cela ne me concerne pas’

9.1 Dependent Variables: Measures of Economic Vulnerability

specifically, if the focus of worries concerned wider sociopolitical problems (Boehnke et al. 1994). Boehnke and his colleagues found that while the content of worries is often related to the level of expectation and aspiration, the intensity of worries and their duration is often assciated with being personally confronted with the problem (for example, loss of income) (Boehnke et al. 1998). Our operational-ization of the Perceived Measure of economic vulnerability taps into the content aspect, but also captures levels of intensity.

This survey question was found in the paper-pencil questionnaire. The response item ‘this does not concern me’ was designed to provide an opportunity for indicat-ing that a given question among the list of worries is irrelevant to the personal situ-ation of the respondent. For example, the question on worry about ‘having to face serious conflicts with my partner or spouse’ obviously only concerned individuals, who were in a relationship at the time of the interview. This response item seems to have been misunderstood by some respondents, who confused it with the response item ‘this does not worry me at all’. However, for the construction of a binary indi-cator, these irregularities in response patterns did not cause any biases because both of the concerned response items were grouped into the same category, so that those who responded ‘this worries me somewhat’ and ‘this worries me strongly’ were categorized as perceived vulnerable (1) and those who said ‘this does not worry me at all’, ‘this doesn’t worry me at all’ or ‘this worries me a bit’ were considered non- vulnerable. Contrary to the self-assessed difficulties in making ends meet, this vari-able does not provide clear qualitative criterion for subjective evaluation;

consequently, the cut-point is less neat. Whether the proposed cut-point between the categories ‘worries me a bit’ (0) and ‘worries me somewhat’ (1) is relevant for dis-tinguishing qualitatively distinct degrees of intensity of financial worries, remains to be shown empirically. Compared to other possible alternative, this cut-point seemed to represent a functional solution as it identified a group of a similar size as the two groups identified by the Objective and the Self-Assessed Measures.