Cite: Cantó, O., & Parra, M. (2026). Is Chronicity Growing? Exploring Intertemporal Poverty in Spain over Three Decades. EQUALITAS Working Papers nº98. 

When we measure poverty, we usually rely on a snapshot: the share of people whose income falls below a threshold in a given year. That cross-sectional picture is informative but conceals a key dimension: poverty dynamics. A society in which many people experience brief and isolated episodes of hardship is fundamentally different from one in which the same households remain trapped below the poverty line year after year. 

Distinguishing between the two is essential: sustained exposure to deprivation impairs children's cognitive development and educational attainment, raising their own risk of poverty in adulthood; it erodes adults' psychological and financial capacity to cope with shocks; and, at the aggregate level, it weakens human capital, strains public finances and undermines social cohesion. Whether poverty is becoming more chronic is therefore not only a question of individual well-being but also of the sustainability of inclusive growth itself.

A consistent conclusion of the literature up to the early 2000s was that, in most EU countries, poverty spells were comparatively short. Spain stood out within this picture, combining high cross-sectional poverty with unusually high recurrence and a comparatively small core of persistently poor individuals (Cantó et al., 2012). Nevertheless, a growing body of work suggests that the Great Recession may have altered these trajectories, increasing both the incidence of long-term poverty and the role of state dependence across the European Union (Mussida and Sciulli, 2022; Franzen and Bahr, 2024). 

Despite its relevance, robust long-run evidence on the evolution of intertemporal poverty in advanced economies remains scarce. This is the gap we aim to fill in a new working paper, in which we examine the intertemporal dimension of poverty in Spain over the last three decades, drawing on income data from the European Community Household Panel (ECHP) and the European Union Statistics on Income and Living Conditions (EU-SILC). We try to answer a central question: has poverty in Spain become more chronic over time, and if so, what mechanisms underlie this change? 

Poverty as a trajectory, not as a specific moment in time

Part of the difficulty is conceptual. Identifying who counts as “chronically poor” requires a normative decision on how we assume that individuals can transfer income from one period to another by saving or asking for loans. The literature has traditionally been divided between the permanent income approach, which assumes full intertemporal compensation (Ravallion, 1988), and the spells approach, which assumes that no transfer is possible due to strong credit constraints at the bottom of the income distribution (Foster, 2009; Gradín et al., 2012). We also have some hybrid proposals that allow for different degrees of intertemporal compensation (Foster and Santos, 2013). Rather than commit to a single view, we deliberately employ four well-established indicators based on different approaches so that we can check if, whatever the approach, a consistent conclusion emerges.

What do our results reveal?

We document two main findings. The first concerns the changing nature of poverty itself. While the share of ever-poor individuals has slightly declined—from around 34% in the mid-1990s to roughly 31% today—what was predominantly a temporary condition has become a much more chronic one. 

This shift implies that among those who fall into poverty at any point in time, an increasing fraction remains trapped there: in recent years, more than half, regardless of the approach. Moreover, those identified as chronically poor are now worse off than before, which means that their level of deprivation has grown more severe regarding poverty intensity and persistence. Figure 1 shows that, whatever indicator we use, the chronic share within intertemporal poverty rises sharply around the Great Recession and remains high ever since.

Our second finding is arguably more consequential. One might reasonably expect that as households attained higher levels of education and developed stronger ties to the labour market, their risk of prolonged deprivation would decline. Why, then, did chronic poverty rise? To address this, we conduct an Oaxaca–Blinder decomposition, which separates how much of the change reflects shifts in people’s characteristics from how much reflects a change in the protection against poverty these characteristics provide. 

We find that improvements in population endowments did push intertemporal poverty down. Indeed, these have reduced the weight of the ever-poor rate in the population. However, as shown in Figures 2a and 2b, this compositional gain has been outweighed by a deterioration in the returns to those characteristics. In the case of the ever-poor, the negative overall difference is driven entirely by the characteristics component: once endowments are held constant, the underlying risk of experiencing intertemporal poverty is higher today than three decades ago. In the case of the chronically poor, this is not the case: the overall difference is in itself positive, as the decline in returns largely offsets the improvement in composition.

In a nutshell, the same education, the same job and the same household situation shield an individual from short-term and long-term poverty considerably less today than they did three decades ago. What has changed, fundamentally, is how little people's circumstances now protect them: if the population’s characteristics had not improved, the rise in chronic poverty would have been even larger.

Policy implications

These findings carry a clear message. Even if improving people’s endowments by expanding education, promoting employment and supporting household stability helps reduce poverty levels, the protective power of those endowments has been eroded since the Great Recession in Spain. Thus, even if strengthening individual characteristics remains necessary, it is no longer sufficient to reduce people's probability of stepping into chronic poverty.

Attention must shift to the effective impact of individual characteristics on the probability of avoiding poverty persistence. Thus, key policies must improve the quality and stability of employment rather than its mere availability (which in Spain means confronting labour precariousness), promote the extension of the coverage and adequacy of social transfers for households that repeatedly fall below the poverty line and, crucially, effectively design adequate income-support mechanisms for the persistently poor. 

References

• Cantó, O., Gradín, C. and del Río, C. (2012). Pobreza crónica, transitoria y recurrente en España. Revista de Economía Aplicada, 20(58), 69–94.

• Foster, J. E. (2009). A class of chronic poverty measures. In Poverty Dynamics: Interdisciplinary Perspectives (pp. 59–76).

• Foster, J. E. and Santos, M. E. (2013). Measuring chronic poverty. In Poverty and Social Exclusion (pp. 161–183). Routledge.

• Franzen, A. and Bahr, S. (2024). Poverty in Europe: how long-term poverty developed following the financial crisis and what drives it. International Journal of Social Welfare, 33(2), 482–494.

• Gradín, C., del Río, C. and Cantó, O. (2012). Measuring poverty accounting for time. Review of Income and Wealth, 58(2), 330–354.

• Mussida, C. and Sciulli, D. (2022). The dynamics of poverty in Europe: what has changed after the Great Recession? The Journal of Economic Inequality, 20(4), 915–937.

• Ravallion, M. (1988). Expected poverty under risk-induced welfare variability. The Economic Journal, 98(393), 1171–1182.