Statistical matching of European Union statistics on income and living conditions (EU-SILC) and the household budget survey : 2017 edition

The Europe 2020 social inclusion target is measured through work attachment, income and material deprivation indicators using the EU Statistics on Income and Living Conditions (EU-SILC). However, there has been increasing interest in recent years in whether expenditure and consumption provide more appropriate measures of standards of living than income. So, this paper compares people's exposure to poverty using three different measures: income, expenditure and material deprivation. However, no single data source provides joint information on all these variables. Therefore, the paper describes methodological work conducted to statistically match expenditure from the Household Budget Survey with income and material deprivation contained within EU-SILC using data for six EU countries. The three matching approaches used are parametric, non-parametric and mixed. Overall, the mixed methods approach tends to perform slightly better at matching expenditure, based on a variety of measures. The implications of this work for the ongoing review of the EU-SILC legal basis are discussed.