Low income measurement in Canada : Mesure du faible revenu au Canada : que nous apprennent les divers seuils et indices?

To classify individuals as low income the MBM uses the cost of a predetermined basket of goods and services, the LICO uses a fixed spending pattern, while the variable LIM uses the median of the contemporary income distribution, and the fixed LIM uses the median of an income distribution in a pre-determined year. [...] But it has several unique characteristics: (1) in the base year selected, the thresholds of the fixed LIM line are identical to that of the variable LIM line; (2) outside of the base year, the thresholds of the fixed LIM are obtained by updating the base year thresholds with consumer price index; and (3) the base year is re-set periodically, say, every five or ten years. [...] First, the low income lines differ in terms of the complexity of the methodology which affects the transparency of the measure and its ease of communication. [...] The after-tax low income lines and family after-tax income were employed to calculate the low income rates under LICO, variable and fixed LIMs, while family disposable income was used to obtain the low income rate under the MBM line.6 To help visualize the historical variations, the estimated incidences were standardized to 1 using their corresponding values in the year 2000.7 The unemployment rat [...] Finally, even when the changes in the incidence are in the same direction, the magnitudes of the changes can be different under different low income lines.