FYR of Macedonia - Measuring welfare using the Survey of Income and Living Conditions (SILC)

The present work is based on an analysis performed in-situ by World Bank staff on the offices of the FYR Macedonian SSO, given the restricted-access policy for the data. The analysis is expected to be updated in June 2015 with information from the 2012 and 2013 SILC, which will allow for a richer analysis, particularly in terms of time trends. The analysis presented here, however, is considered valuable in that it provides first insights into the socio-demographic characteristics of the bottom of the income distribution and the interactions between different measures of poverty. The poverty and inequality statistics are complemented with socioeconomic characteristics of the poor and the bottom 40 percent2, an analysis of the sources of income at the household level, and an international benchmarking of poverty in FYR Macedonia. Finally, this note benchmarks the poverty measurement currently used in FYR Macedonia, the At-Risk-of-Poverty and Social Exclusion (AROPE), with other measurements of poverty based on different poverty lines, which allows for a better understanding of the policy implications of transitioning the new ways of measuring poverty. The following section presents recent poverty and inequality indicators for FYR Macedonia. Section three delineates a poverty profile for the poor and the bottom 40, and analyzes the sources of income for FYR Macedonian households. Section four benchmarks the country with other countries, based on poverty and AROPE indicators, and examines the overlap between the AROPE and its components with other methodologies of identifying the less well-off. Section five concludes.