How material deprivation impacted economic stress across European countries during the great recession. A lesson on social comparisons

Abstract

The development of a common standard of consumption is one goal of the ongoing harmonization of the EU member states’ economies. As a result, the degree to which household deprivation affects people’s economic stress should converge. Based on comparison theory, such convergence could be one indicator for Europe growing together (‘Europeanization’). The association between deprivation and economic stress is tested across and between 28 EU countries with EU-SILC data. Moreover, it is examined whether this association changed between 2007 and 2015, as the great recession starting in 2008 affected European countries differently. The results show that, given a certain level of household deprivation, people judge their situation differently across Europe. Whereas economic stress levels are higher in relatively poor countries, the deprivation-stress link is stronger in rich countries. Across-time comparisons suggest no decline in the extent to which a country’s deprivation level moderated the effect of household deprivation on economic stress. The findings support the persistence of national reference groups against which individuals judge their own economic situation.