**Table 2.** Deprivations included in the severe material and social deprivation rate (SMSD), Europe 2030

||**Deprivations at the Household Level**|**Deprivations at the Individual Level**|
|---|---|---|
|**Severe material**<br>**and social**<br>**deprivation rate**<br>**(SMSD)**|1. Capacity to face unexpected<br>expenses<br>2. Capacity to afford to pay for a one-<br>week annual holidayawayfrom home<br>3. Capacity to be confronted with<br>payment arrears (on mortgage or<br>rental payments, utility bills, hire<br>purchase installments, or other loan<br>payments)<br>4. Capacity to afford a meal with meat,<br>chicken, fish, or vegetarian equivalent<br>everysecond day<br>5. Ability to keep home adequately<br>warm|1. Having an internet connection<br>2. Replacing worn-out clothes with some<br>new ones<br>3. Having two pairs of properly fitting<br>shoes (including a pair of all-weather<br>shoes)<br>4. Spending a small amount of money<br>each week on him/herself<br>5. Having regular leisure activities|
||6. Have access to a car/van for<br>personal use<br>7. Replacingworn-out furniture|6. Getting together with friends/family<br>for a drink/meal at least once a month|

Source: Eurostat - <u>https://ec.europa.eu/eurostat/statistics explained/index.php?title=Glossary:At_risk_of_poverty_or_social_exclusion_(AROPE)</u>

**Other multidimensional poverty indicators are commonly used in other countries/regions.** These include the Unmet Basic Needs, traditionally used in Latin American countries, the UNDPOPHI Multidimensional Poverty Index (MPI) developed by the Alkire-Foster Approach to Multidimensional Poverty, and the Global Multidimensional Poverty Measures (MPM) developed by the World Bank.<sup>19</sup> These measures might include different dimensions of deprivations and/or indicators not included in the AROPE, including education, health, infrastructure, etc. (see Annex 2 for differences in dimensions and indicators). The World Bank MPM is made publicly available for EU countries, and some experimental multidimensional indices following UNDP-OPHI have also been published, as mentioned before. Recent evidence proposes a conceptual framework for social exclusion and a multidimensional measure (Cuesta et al. 2024).

**This paper primarily follows the AROPE 2030 framework, which is the primary framework for analyzing multiple deprivations among vulnerable groups, given its prominence as the standard measure for policy formulation and monitoring within the EU.** The AROPE framework has several advantages among the multidimensional poverty measures. First, AROPE is situated within the extensive body of research on multidimensional poverty measurement,<sup>20</sup> and adheres to globally recognized criteria when crafting indicators and dimensions to assess household wellbeing in the EU. Moreover, the material deprivation index, which leverages a methodology pioneered in 1999 and further refined in 2012<sup>21</sup> ,  generates a deprivation measure for the EU that is appropriate and exhibits validity, reliability, and additivity. Second, the AROPE indicators can be constructed with microdata from the European Union Statistics on Income and Living

> 19 For more details, see World Bank (2018a).

> 20 See World Bank, UNDP & UNICEF (2021).

> 21 See Guio et al. (2016).

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