New Measures of Economic Insecurity Reveal its Expansion Into EU Middle Classes and Welfare States

Abstract

Economic instability, social changes, and new social policies place economic insecurity high on the scholarly and political agenda. We contribute to these debates by proposing a new multidimensional, intertemporal measure of economic insecurity that accounts for both its multiplicity and its dynamism. First, we develop three theory-driven, multidimensional measures of economic insecurity. Principal Components Analysis validates the measure. Second, we develop a dynamic approach to insecurity, using longitudinal data and a newly revised headcount method. Third, we then use our new measures to analyze the distribution of insecurity in Europe. Our analysis shows that insecurity is widespread across Europe, even in low-inequality, encompassing welfare states. Moreover, it extends across income groups and occupational classes, reaching into the middle classes.