The Multidimensional Aspects of Social Exclusion and Ethnicity in the United Kingdom

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ABSTRACT 
The following paper aims to shed a light on the multidimensional aspects of individual 
socio-economic status (SES), location effects and ethnic minorities, which are socially 
excluded or materially deprived. The main purpose is to analyse empirically the evidence 
of the influence of such factors on dependent variables. In particular we focused on two 
widely applied methods for computing social exclusion: below edge of poverty and 
material deprivation. We introduce new evidence using the British Household Panel 
Survey (BHPS), estimating our model with a bivariate probit regression on both 
approaches.
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Introduction 
In recent years the European Union had an increasing interest and competence on 
social policy, even though, social policies themselves including policies to maintain and 
raise social inclusion have been and still are the responsibility of Member States under 
the principle of subsidiary. In particular, the Amsterdam Treaty, entered into force in 
1999, assigned in its policies a crucial role to the fight against social exclusion and then the 
Social Policy Agenda, adopted by the Nice European Council, has expanded and 
deepened this scope. In this framework, where the links between economic and social 
dimensions are increasingly seen as of central importance, specific criteria were set out in 
2001 during the Nice Summit, together with a requirement that each member state 
produce a biennial national action plan (NAP) on social inclusion, addressing five key 
objectives specified through the summit. 
The Nice objectives, which include a specific reference to addressing vulnerable groups at 
particular risk of exclusion, are as follows: 
 Facilitating participation in employment and access to resources, 
 Rights, goods and services; 
 Preventing the risks of exclusion; 
 Helping the most vulnerable; and 
 Mobilising all relevant bodies in overcoming exclusion. 
Nonetheless, Member States are allowed to interpret these objectives in different ways 
through the ‘Open Method of Coordination’. This method means that common 
objectives are set at European level, while Member States design nationally appropriate 
policies and report on these and on their outcomes, thus both monitoring progress and 
sharing best practice. 
Together with social exclusion, the European Union has continually revised its thinking 
about social deprivation, adopting a view of poverty relative to rising average living 
standards, and, more recently, a framework for thinking about non-monetary aspects of 
deprivation, which is the real innovation. Monitoring the progress of these policies 
require the development of appropriate modes of measurement.
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Social exclusion and poverty are conceptually distinct, even if they are often related. The 
Stockholm European Council, in March 2001, proposed ten primary indicators of social 
exclusion: (1) Low income rate after transfers with low-income threshold set at 60% of 
median income (with breakdowns by gender, age, most frequent activity status, household 
type and tenure status); (2) distribution of income (income quintile ratio); (3) persistence 
of low income; (4) median low income gap; (5) regional cohesion; (6) long term 
unemployment rate; (7) people living in jobless households; (8) early school leavers not in 
further education or training; (9) life expectancy at birth; (10) self-perceived health status. 
As we can see, the first three indicators out of ten captured ''financial poverty'', more 
specifically: 
1. The share of the population below 60 per cent of national median equivalent 
income before and after social transfers; 
2. The ratio of the share of the top 20 per cent to the share of the bottom 20 per 
cent of the income distribution; and  
3. Persistent of poverty, or the share of the population below the 60 per cent poverty 
line for three consecutive years. 
Alongside income-related measures of poverty, a broader perspective of social inclusion 
can be obtained by studying other measures, for example, those relating to material 
deprivation. In contrast with income related indicators, material deprivation provides a 
more absolute rather than a relative analysis of social exclusion. The definition of material 
deprivation is based on the inability to afford a selection of items that are considered to 
be necessary or desirable. Taking into account material deprivation's indicators can help 
us to perceive the concept of social exclusion as a multidimensional condition and in 
order to better understand this vision we developed an econometric framework that 
includes also some types of material deprivation. 
In particular, in our model, we followed the development of health indicators; as far as 
health is concerned, inequalities in health and access to health services are now seen as 
strictly related to social exclusion. The impact that illness and disability have on the 
potential of a fully participation in society are critical: those with chronic illness and weak 
health status may face severe obstacles in obtaining access to education, employment, 
independent housing and other aspects of social inclusion and participation.
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Undoubtedly, this is difficult to assess in comparable ways across countries given the 
challenge in measuring health problems in a harmonised way, but is of central importance 
to a significant group of individuals (Atkinson et al, 2007). 
In our analysis of social exclusion, based on United Kingdom dataset provided by the 
British Household Panel Survey, we decide to go further and taking into account race and 
the diverse ethnic groups that we found in the UK, such as White, Black Caribbean, 
Black African, other Black minorities, Indian, Bangladeshi, Pakistani, Chinese and other 
minor ethnic groups. Despite the fact that a great variety of minority situations exist, 
common to all is the fact that, often, minorities face multiple forms of discrimination 
resulting in marginalisation and exclusion. 
The document which sets essential standards and offers guidance to States in adopting 
appropriate policies and other measures to secure the rights of persons belonging to 
ethnic minorities is provided through the ''United Nations Declaration on the Rights of 
Persons Belonging to National or Ethnic, Religious and Linguistic Minorities (1992)''. 
The declaration affirms that, through their commitments under treaty law, and minorities 
themselves, States can influence the human rights monitoring and implementation 
procedures, and work toward securing effective participation and inclusion of these 
various ethnicities. 
However, there is the risk of a high correlation between social exclusion and ethnicity, 
which can lead towards both ''human'' and ''financial'' costs for society. For example, 
individuals who experience social exclusion can face several underachievement in 
education and in the labour market or low income, poor access to services, stress, ill-
health and the impact on children; and this spiral of disadvantages reduced social 
cohesion, higher crime and fear of crime, and higher levels of stress and reduced 
mobility. On the other side, the financial costs came in paying for crime, school 
exclusions, drug misuse and unemployment, and in lost tax revenue. Also industries and 
economy suffered from a less skilled workforce, lost customers and markets, and the rest 
of the population had to pay the tax bills for social failure. It followed that it would benefit 
everyone in society if social exclusion could be reduced and made less likely in future.
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CHAPTER 1 
1. Social Exclusion 
Jacques Delors, former president of the European Commission in the mid-1980, 
used for the first time the word “exclusion”, with the aim of drawing the attention on a 
pivotal social dimension of the European integration process. For this reason, the 
European Social Protocol was developed from 1989 to 1997, when it became part of the 
Amsterdam Treaty. 
The concept of social exclusion is very broad and complex. Several definitions are 
present in the literature; most of them refer to exclusion from activities that are ''normal'' 
or available to the ''average citizen'', or the majority of citizens. Sometimes they are not 
clear and precise, and their level of abstraction implies that they are not empirically 
defined. A very interesting composite definition that embrace several factors adopted in 
the literature is: ''Social exclusion is a complex and multi-dimensional process. It involves 
the lack (or denial) of resources, rights, goods and services, and the inability to participate 
in the normal relationships and activities, available to the majority of people in a society, 
whether in economic, social, cultural or political arenas. It affects both the quality of life 
of individuals and the equity and cohesion of society as a whole'' (R. Levitas et al, 2007). 
This dynamic and multi-dimensional process is driven by unequal relationships across 
four main dimensions - economic, political, social and cultural - and at different levels 
including individual, household, group, community, country and global levels. 
Even though, there are particular cases when individuals are most vulnerable, i.e. distinct 
times in the lifecycle, such as when leaving home, care or education. On the other hand, 
we can have this disproportionately risk of social exclusion even for certain groups of 
individuals, for instance those growing up in low income households or with family 
conflicts, those who do not attend school, or young people in care and people from some 
minority ethnic communities. 
In addition, there is a clear distinction between active exclusion and passive exclusion; 
when, for example, immigrants or refugees are not given a usable political status, it is an 
active exclusion, and this applies to many of the deprivations from which minority 
communities suffer in Europe and elsewhere.