Essays on Modelling Inequality and Interdependencies

In an attempt to include missing dimensions of well-being, Chapter 1 builds on the literature by proposing a novel multidimensional poverty measure building on Alkire-Foster methodology. Compatibility of the novel indicator is illustrated, by using a degree of overlap analysis between existing poverty indicators. I find that, the new method is highly consistent with the conventional measures of deprivation, and multidimensional poverty has been seen to decrease during the period of examination. Main determinants of hardship conditions and the severity of deprivation have also been identified in Chapter 1. Chapter 2 identifies similarities and consequential heterogeneities between OECD regions, in relation to the impacts of financial disturbances on their economies. This chapter is a joint work with my co-author Edgar Flores. The features and pass-through effects of macroeconomic and financial shocks across regions are examined through a novel multi-country weighting scheme proposed in Chapter 3, the results obtained by redefined linkages provide a comprehensive description of inter-regional interactions in OECD countries. Chapter 3 suggests a shift towards a meticulous definition of inequality that allows for the widening of the evaluative space via taking into consideration the redistributive role played by government through provision of public services by building upon the work of Malul et al. 2013. Another contribution of this Chapter is its proposed methodology; European interlinkages are redefined to cover not only the trade channel, but also financial exchanges, geographical proximities and bilateral migration flows, in an attempt to capture fully the depth and complexity of cross-country dynamics. The findings relate to the EU 2020 headline targets by displaying the short and long-term dynamics of income disparities, and they also provide further evidence of how heterogeneous the magnitude of poverty responses to such inequality developments is across European economies.