Unveiling Multidimensional Poverty Insights from the EU Monica Robayo-AbrilLucia Echeverria Poverty Global DepartmentJanuary 2025 A verified reproducibility package for this paper isavailable athttp://reproducibility.worldbank.org,clickherefor direct access. Policy Research Working Paper11027 Abstract The European Union has improved living standards, yetwelfare disparities persist across regions, countries, anddemographic groups. This paper uses data from Euro-pean Union Statistics on Income and Living Conditionscross-sectional and longitudinal surveys and the at-risk-of-poverty or social exclusion framework to analyze recenttemporal trends in absolute multidimensional povertyacross the 27 countries in the European Union and itssubregions. The analysis quantifies the extent, composition,and factors associated with the higher risks of multidimen-sional poverty across four countries (Bulgaria, Romania,Croatia, and Poland) and extends the at-risk-of-poverty orsocial exclusion framework to consider other dimensions ofdeprivations. The paper analyzes the extent of multidimen-sional poverty among the Roma population in Bulgaria andassesses the extent of chronic income poverty and chronicmaterial deprivation among this group. The analysis revealsthat some European Union member states present strikinglydivergent trends in multidimensional poverty compared to the European Union average, and there have been differentrates of progress across subregions. Results of the analysis ofthe four countries of interest indicate that although mon-etary poverty risks are comparable across these countries,there are notable variations in the incidence of nonmonetaryindicators and the intensity of deprivations. However, thelikelihood of being multidimensionally poor is conditionedby similar individual, socioeconomic, and family charac-teristics across countries. The Roma population in Bulgariaencounters more concurrent disadvantages compared to thebroader population and is significantly more likely to bedisproportionately represented among those experiencingchronic poverty and material deprivations. These findingsunderscore the urgent need for targeted policy interven-tions that tackle the most pressing needs of disadvantagedpopulations. Finally, the study proposes a set of potentialpolicy interventions to address structural inequalities andimprove the well-being of vulnerable populations. This paper is a product of the Poverty Global Department. It is part of a larger effort by the World Bank to provide openaccess to its research and make a contribution to development policy discussions around the world. Policy ResearchWorking Papers are also posted on the Web at http://www.worldbank.org/prwp. The authors may be contacted atmrobayo@worldbank.org. A verified reproducibility package for this paper is available athttp://reproducibility.worldbank.org, clickherefor direct access. The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about developmentissues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry thenames of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely thoseof the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank andits affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent. Unveiling Multidimensional Poverty: Insights from the EU* Monica Robayo-Abril1 Lucia Echeverria2 1World Bank 2World Bank and Universidad Nacional de Mar del Plata JEL classification: I32, O52, D63 I.Introduction The European Union boasts some of the highest living standards globally, yet significantwelfaredisparities persist among its regions and populations.Headcountincomepoverty atthe $25 high-income country poverty line(in 2017 PPP)in the EU27 region hasshownfluctuations over the long term, peakingat 38.2 percent in 2006 before gradually declining to22.1 percent in 2021. Eastern and Central European countries have experienced a significantlyfaster declinethanotherEuropeansubregions.1More recently,the anchoredat-risk-of-poverty(AROP)ratefor theEU27 countries hasdecreased from 16.5 in 2019 to 13.8percentin 2022.2Despite the progress witnessed across nations and regions in the last two decades, disparitiesinmonetary povertypersist.In 2022, while somecountrieslike Belgiumand Czechia demonstraterelatively lower AROPrates(12.3 and 9.8 percent, respectively), others like Bulgaria and Estoniaexhibitsignificantlyhigher rates(20.6 and 22.5 percent).3The COVID-19 and Ukraine crises havedisproportionately impacted low-income populations, who experienced more severe incomedeclines compared to middle-class and wealthier households, mostly due to the differentiatedimpacts on the labor