Entrepreneurs and Freelancers: Are They Time and Income Multidimensional Poor? The German Case

Entrepreneurs and freelancers, the self-employed, commonly are characterized as not only to be relatively rich in income but also as to be rich in time because of their time-sovereignty in principle. Our introducing study scrutinises these results and notions about the well-being situation of self-employed persons not only by asking about traditional single income poverty but also by considering time poverty within the framework of a new interdependent multidimensional (IMD) poverty concept. The German Socio-economic panel with satisfaction data serves as the data base for the population wide evaluation of the substitution/compensation between genuine, personal leisure time and income. The available detailed Time Use Surveys of 1991/92 and 2001/2 of the Federal Statistics Office provide the data to quantify the multidimensional poverty in all the IMD poverty regimes. Important result: self-employed with regard to single income poverty, single time poverty and interdependent multidimensional time and income poverty in both years are much more affected by time and income poverty than all other active persons defining the working poor. A significant proportion of non-income-poor but time poor of the active population are not able to compensate their time deficit even by an above poverty income. These people are neglected so far within the poverty and well-being discussion, the discussion about the 'working poor' and in the discussion about time squeeze and time pressure in general and in particular for the self-employed as entrepreneurs and freelancers

Time and Income Poverty - An Interdependent Multidimensional Poverty Approach with German Time Use Diary Data

Income as the traditional one dimensional measure in well-being and poverty analyses is extended in recent studies by a multidimensional poverty concept. Though this is certainly a progress, however, two important aspects are missing: time as an important dimension and the interdependence of the often only separately counted multiple poverty dimensions. Our paper will contribute to both aspects: First, we consider time - and income - both as striking and restricting resources of everyday activities and hence account for time and income as important multiple poverty dimensions. Second, the interdependence of the poverty dimensions will be evaluated by the German population to allow an advanced approach to understand possible substitution effects and the respective trade offs between the dimensions. Referring to the time dimension, we follow Sen's capability approach with its freedom of the living conditions' choice and social exclusion and argue, that restricted time might exclude from social participation. In particular, restricted genuine, personal leisure time (not entire leisure time) in particular is associated with a restricted social participation. The crucial question then is how to measure the substitution between income and such genuine leisure time. In our analysis we consider the country population's valuation with data from the German Socio-Economic Panel and estimate the substitution by a CES-utility function of general utility/satisfaction. Given this quantification we disentangle time, income and interdependent multidimensional poverty regimes characterising the working poor. In addition, we quantify further socio-economic influences for each interdependent multidimensional poverty regime by a multinomial logit based on time use diary data of the German Time Use Study 2001/02. One striking result for Germany: the substitution between time and income is significant and we find an important fraction of time poor who are unable to substitute their time deficit by income. These poor people are ignored within the poverty and well-being as well as the time crunch and time famine discussion so far