Deriving a Measure of Financial Hardship from the HILDA Survey

Abstract

While much research concerned with poverty assesses reported income, an alternative approach is to consider measures of financial hardship or deprivation. The use of hardship measures is an attempt to identify people who are 'excluded from minimally acceptable ways of life of the society in which they live because of a lack of resources' by directly assessing their privation (Whelan et at. 2001, p. 358). Such measures typically assess the extent to which, due to a lack of financial resources, individuals or households lack access to goods, facilities or services or are unable to engage in activities that are considered basic necessities (Whelan 1993).