This study analyses changes in income inequality in Malta and its driving factors between 2005 and 2018. The study employs and analyses data collected by Malta's National Statistics Office, which conforms with the European Union Survey on Income and Living Conditions. Education and labour status are identified as key drivers behind income inequality changes over the period under review. While the Gini coefficient remained relatively stable between 2005 and 2018, the Lorenz curve moved further away from the line of equality at the upper end of the income distribution, showing modest increases. Over the 2014-2018 period, Government intervention has been mildly neutralizing through social transfers but not through taxes. Social transfers provided a greater safety net to citizens than they did during the 2005-2009 period, whereas tax reforms have abraded some tax progressivity. We also find that inequality was mostly attributed to differences in the individual's qualifications, hours worked, occupations, and household employment structure and size, highlighting an important role for policy to further reduce the barriers to economic inclusion. ; peer-reviewed
We set out to examine the relationship between cultural engagement and wellbeing in a European Union state, Malta. We specify a conceptual model of wellbeing, captured by self-assessed life satisfaction as the predicted variable. Armed with a rich dataset (n = 1,125), drawn from a nationally representative sample, we construct variables that capture the diverse forms of cultural participation including a variable that identifies artists. We test three hypotheses, namely that passive cultural participation (audience) is positively associated with life satisfaction, that active (productive) cultural participation is positively associated with life satisfaction, and that artists have a higher level of life satisfaction, all else being equal. We find that both active and passive participation activities are associated with higher levels of life satisfaction; that active participation (including production, donation and travel) manifests a stronger relationship with life satisfaction than passive participation; and that life satisfaction is higher among those who identify as artists even after the effects of all other control variables are parsed out. This being the first nationally representative study on life satisfaction in Malta, the study makes a useful contribution in this regard, finding that factors like employment, health, engagement in sport, politics, religion, environment, as well as region of residence and migration are all significant correlates of life satisfaction.
We set out to examine the relationship between cultural engagement and wellbeing in a European Union state, Malta. We specify a conceptual model of wellbeing, captured by self-assessed life satisfaction as the predicted variable. Armed with a rich dataset (n = 1,125), drawn from a nationally representative sample, we construct variables that capture the diverse forms of cultural participation including a variable that identifies artists. We test three hypotheses, namely that passive cultural participation (audience) is positively associated with life satisfaction, that active (productive) cultural participation is positively associated with life satisfaction, and that artists have a higher level of life satisfaction, all else being equal. We find that both active and passive participation activities are associated with higher levels of life satisfaction; that active participation (including production, donation and travel) manifests a stronger relationship with life satisfaction than passive participation; and that life satisfaction is higher among those who identify as artists even after the effects of all other control variables are parsed out. This being the first nationally representative study on life satisfaction in Malta, the study makes a useful contribution in this regard, finding that factors like employment, health, engagement in sport, politics, religion, environment, as well as region of residence and migration are all significant correlates of life satisfaction. ; peer-reviewed
This paper presents an analysis of forecasting errors of the Economic Policy Department's forecasts for Malta. Based on this analysis an approach for carrying out a risk assessment of macroeconomic forecast is proposed. In particular, this paper contains: 1. an evaluation of the Economic Policy Department's macroeconomic forecast errors since 2004, 2. a comparison of Economic Policy Department's forecasting performance with that of the European Commission and the Central Bank of Malta, 3. an assessment of Malta's forecast performance compared with that of other European economies, 4. an evaluation of possible biases in the forecast, and finally, 5. a methodology for the illustration of forecast uncertainty and the balance of risk surrounding our forecast through the use of Fan Charts. The publication is in line with the requirements of Council Directive 2011/85/EU of the European Union on the requirements for budgetary frameworks of the Member States. As from 2014, the Directive binds Member States to guide their macro-economic and budgetary forecasts by the performance of past forecasts and endeavour to take into account relevant risk scenarios. The risk assessment developed in this paper follows the methodology suggested by Selim Elekdag and Prakash Kannan (2009) in their seminal IMF working Paper and will become a regular feature of the Economic Policy Department's published macroeconomic forecasts. ; N/A
The proportion of individuals in material deprivation has almost halved to 8.7% in 2018 when compared to the year the indicator started being collected, 2009. Yet, with a few exceptions, the number of individuals at-risk-of-poverty increased at a yearly rate to reach 16.8% by 2018. At first glance, such divergent trends might appear anomalous, and highlight that poverty dynamics and related indicators warrant a deeper assessment. There is no correct way to define poverty in a society: value judgements play an important role. A long-standing debate is whether poverty is absolute or relative. Some say that the poverty line should reflect the absolute poverty threshold i.e., the cost of purchasing a fixed basket of goods and services that allows people to meet their basic needs; the demarcation between the poor and the non-poor. Others contend that we should instead think of poverty as a relative threshold, i.e., relative to the country's living standard. Those who view poverty in relative terms would argue that the poorest members of society appear to have lagged behind the others; hence the term 'at-risk-of-poverty'. In the absence of an absolute poverty indicator, debates on poverty can easily reach an impasse, as a change in relative poverty may not necessarily reflect a change in absolute poverty. The simplest poverty indicator is obtained by calculating the proportion of the total number of people below the poverty line in society. However, relying on the over-simplification argument that an increase in relative poverty is bad would be analogous to saying that an increase in taxes is bad. Such judgments should be complemented by other analysis such as the rate of taxation, whether the individual is in unemployment or in a high-paying job, and the ultimate purpose of taxation to finance government expenditure. For this reason, even if there is agreement about the appropriate poverty line to use when measuring poverty, various indicators of poverty must be considered besides the headcount ratio. Indeed, the same society may have the exact year-on-year poverty incidence, but the total cost of alleviating all the poor up to the poverty line might be very different each year depending on changes in the poverty gap. Furthermore, the extent to which the incomes of the poor are concentrated in particular income ranges might also vary: many poor might be close to the poverty threshold, with only a few individuals being in extreme poverty, or vice-versa. Another aspect to consider in the poverty debate is the relative poverty threshold: today's living standard is unrecognisable from 2005. In view of a dearth of information on the topic, this study complements existing studies on poverty incidence with other measures relating to poverty intensity and inequality amongst the poor. We also dig deeper in relative poverty headcount rates to identify the factors contributing to such changes over the years. For this purpose, we study poverty dynamics in Malta between 2005 and 2018, with special attention to household characteristics. ; peer-reviewed
