NZiDep: A New Zealand index of socioeconomic deprivation for individuals
Introduction
A non-occupational, deprivation-based, socioeconomic index for individuals (NZiDep) has been developed using New Zealand data for use as a tool in research into the social and economic determinants of health and any other research for which a parsimonious, efficient measure of socioeconomic position is required. The availability of an easy-to-use and widely applicable socioeconomic index for individuals is important because socioeconomic factors, along with ethnicity (Ajwani, Blakely, Robson, Tobias, & Bonne, 2003), are perhaps the most important determinant of health status and broader well-being in developed countries, after age and gender (Berkman & Kawachi, 2000).
The term socioeconomic position is used here to indicate ‘the social and economic factors that influence what position(s) individuals and groups hold within the structure of society’ (Lynch & Kaplan, 2000, p. 14). In the broader body of research into social stratification, the term ‘status’ is used more frequently than ‘position’. However, because the focus of this research is to provide a means to locate an individual on a continuum of material and social deprivation, the emphasis is more upon ‘position’ than ‘status’. We therefore use the term ‘position’ as a generic term here.
The theoretical basis of the NZiDep index is located in the context of the broader fields of social stratification, socioeconomic status and position, social class, deprivation, poverty, and living standards.
Socioeconomic position is concerned with the conditions that people experience. Variations in socioeconomic position are associated with a combination of factors such as resource ownership and control, behaviours and attitudes, and power differentials. These factors lead to differentials in well-being. In this wider area of well-being, continued inter-generational transmission of the inequalities associated with poor outcomes in the areas of education, employment, and income highlight the significance of socioeconomic status for the social and economic outcomes that people experience (Johnson, 2004; Williams, 1997).
Socioeconomic measures are fundamental in most research that relates to measurement of health status and well-being because socioeconomic factors feature both as their key determinants, and as powerful confounding variables in research which aims to examine other associative or causal relationships. However, despite the large body of theoretical work and the wide range of socioeconomic measures in routine use around the world, researchers face a frequently difficult choice of socioeconomic measure for individuals (Krieger, Williams, & Moss, 1997; Liberatos, Link, & Kelsey, 1988; Lynch & Kaplan, 2000). Some measures have become favoured for particular areas of research and policy interest. For example, an income poverty threshold based on 60% of median disposable household income can be applied to measuring the success or otherwise of poverty reduction programmes. It is the case, however, that there is no single universally accepted ‘gold standard’ measure for application in all situations. In view of the complex, politicised, and inherently contentious nature of the underlying construct, the absence of an accepted single gold standard measure of socioeconomic position is not surprising.
The need for robust socioeconomic measures has been responded to in New Zealand with the development of a body of research aimed at providing a socioeconomic basis for measuring and monitoring the impacts of government policies and changing social and economic conditions, on the one hand, and supporting decision-making about the targeting of funding in areas of social expenditure, such as health, on the other. Jensen, Spittal, Crichton, Sathiyandra, and Krishnan (2002, p. 11) identify three streams within this body of research: income-based poverty research and outcome-based deprivation research, both focussing on the lower end of the socioeconomic continuum; and ‘broad spectrum research’ covering the full socioeconomic spectrum.
Within the first stream is the work of the New Zealand Poverty Measurement Project (NZPMP), carried out by the Family Centre Social Policy Research Unit since 1992, mostly in association with the Victoria University of Wellington School of Government (Stephens & Waldegrave, 2001; Waldegrave, Stephens, & King, 2003). Within the second stream is the New Zealand Index of Deprivation (NZDep) that was created within the Department of Public Health at the Wellington School of Medicine and Health Sciences and first released in 1997 (Crampton, Salmond, & Kirkpatrick, 2004; Salmond & Crampton, 2001; Salmond, Crampton, & Sutton, 1998). Within the third stream is the Living Standards Research Programme (LSRP) that began in 1999 with a study of the living standards of older people initiated by the Super 2000 Taskforce (Fergusson, Hong, Horwood, Jensen, & Travers, 2001a). The research was then continued by the New Zealand Ministry of Social Development under its LSRP and yielded the Economic Living Standards Index (Jensen et al., 2002). In addition to the measures identified with these streams, which are all non-occupational measures, there are occupation-based measures, the most recent being the New Zealand Socioeconomic Index of Occupational Status (NZSEI) (Davis, McLeod, Ransom, & Ongley, 1997).
While both the NZPMP and the LSRP were developed for individuals with a broad social and economic policy monitoring role in mind, the small-area NZDep indexes and the individual-level NZSEI were developed initially with a public health policy focus. NZDep was developed with a particular focus on supporting decision making about needs-based targeting of health funding on an area basis. Subsequently, both NZDep and NZSEI have been used by researchers as indicators of socioeconomic position for purposes other than health-related research, policy development, and implementation. Additionally, although NZDep is an area measure, it is increasingly used as a convenient, although often imprecise, proxy individual measure.
The NZPMP, LSRP, NZDep, and NZSEI research programmes have each approached the measurement of socioeconomic position from different perspectives, but together they have produced a richer and more evidential picture of socioeconomic hardship in New Zealand. However, no single measure provides a full canvas. Income poverty research, for example, is essential for policy development because tax and benefit transfers are the primary instruments used to redistribute money in modern post-industrial states. In these circumstances, measures of income thresholds and people's relative position in relation to them are required. Income measures on their own, however, essential as they are, do not always discern the different living conditions experienced by households. Some poor families are more asset rich than others, some have better networks and community supports, some have high-status work connections, and some have existed on a low income for longer than others. To gain an accurate measurement of socioeconomic position for a person or household, a range of conceptual measures is required.
Section snippets
Theoretical perspectives
There are two broad approaches to the measurement of socioeconomic position. One is based on the production side of the economic equation, and emphasises the differential availability of resources to people. The other is based on the consumption side of the equation, and emphasises the conditions actually experienced by people. Fig. 1 summarises the ways in which four key concepts and approaches to the study and measurement of socioeconomic position are aligned with the production and
Existing measures of socioeconomic position
For the purposes of measurement criteria, the factors that are taken into account when measuring socioeconomic position on the basis of the four key concepts of Class/Socioeconomic status, Income poverty, Living standards, and Deprivation, can be divided into occupational and non-occupational measures (Fig. 1). Class/Socioeconomic Status is the only concept that is occupationally measured. The measures with the longest history are those based on income, education and occupation.
Methods
The survey-based NZiDep index was derived using the same theoretical basis as the national census-based small-area indices of relative socioeconomic deprivation: NZDep91, NZDep96, and NZDep2001 (Crampton et al., 2004; Salmond & Crampton, 2001; Salmond et al., 1998). Preliminary work on finding an individual-level index of socioeconomic deprivation used anonymous unit-record census data and showed that the statistical process used for development of the NZDep indices could also be used for
Results
The ultimate task was to choose a sub-set of the 28 deprivation variables to form a practical index of deprivation that could be used in future survey work and was appropriate for adults in all ethnic groups.
The first step in the data reduction process was to establish if any of the 28 variables were unsuitable for inclusion for primary reasons such as too much missing data, or too rare a deprivation event. Seven such variables were excluded from further consideration (electricity bill
Discussion
We have established a good set of eight questions as the basis for a simple individual-level index of socioeconomic deprivation, NZiDep (see Appendix A).
In developing NZiDep, we took care to ensure that minority Maori and Pacific people were represented on statistically equal terms with members of the general population. This was important because Maori and Pacific people are over-represented among those who have one or more deprivation characteristics, so the conditions they experience should
Acknowledgements
We are indebted to Dr. Catherine Love and Taimalieutu Kiwi Tamasese for their invaluable contributions of Maori and Pasifka cultural knowledge to the questionnaire development and survey fieldwork. We are indebted, also, to the survey interviewers who undertook the difficult and challenging task of locating and recruiting over 900 participants in accordance with tightly defined sample quota. This research was funded by grant 00/290 from the Health Research Council of New Zealand.
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