Regional Poverty Levels in the European Union: A Spatial Econometric Approach

Abstract

The main objective of this study is to analyze the most important determinants of monetary poverty (at the macro-level) in the European Union, taking into account the effects of regional spillovers. Regression analyses of spatial data in the period 2007–2009, i.e. the pre-crisis and crisis years are performed in order to compare the size of the impact of the selected variables on poverty levels. In the study, a spatial Durbin model (SDM) is employed and the sample includes 187 EU regions. In order to quantify the impacts of the explanatory variables, scalar summary measures are used (the average direct impacts, as well as the indirect and total impacts of income, are negative).