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Public cash transfers and poverty dynamics in Europe

Author

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  • Iryna Kyzyma

    (Research Group International Distribution and Redistribution, Centre for European Economic Research (ZEW)
    Luxembourg Institute of Socio-Economic Research, Maison des Sciences Humaines
    Institute for the Study of Labor (IZA))

  • Donald R. Williams

    (Luxembourg Institute of Socio-Economic Research, Maison des Sciences Humaines
    Kent State University)

Abstract

Using individual-level data for 11 European countries, in combination with country-level data, this paper examines associations between the receipt of public transfers by individuals and their probabilities of exiting and entering poverty, as well as the total amount of time spent below the poverty line. Rather than focusing on welfare regime typology or shares of transfers in total income as most studies do, we partition total transfer income into separate transfer components and account for countries heterogeneity in their provision. The results show that an increase in the amount of unemployment transfers received by individuals is associated with higher probabilities of exiting poverty when these transfers are combined with well-developed active labor market policies. Old-age transfers become an important instrument for the reduction in time spent below the poverty line if they are generous in size and not progressively distributed along the total income distribution. Finally, an increase in the amount of family benefits received is associated with lower probabilities of poverty entry in the countries which spend larger shares of gross domestic product on child care facilities.

Suggested Citation

  • Iryna Kyzyma & Donald R. Williams, 2017. "Public cash transfers and poverty dynamics in Europe," Empirical Economics, Springer, vol. 52(2), pages 485-524, March.
    • Handle: RePEc:spr:empeco:v:52:y:2017:i:2:d:10.1007_s00181-016-1085-5
    DOI: 10.1007/s00181-016-1085-5
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    Cited by:

    1. Saeed, Muhammad Kashif & Hayat, Muhammad Azmat, 2020. "The Impact of Social Cash Transfers on Poverty in Pakistan-A Case Study of Benazir Income Support Programme," MPRA Paper 99805, University Library of Munich, Germany.
    2. Elena Bárcena-Martín & M. Carmen Blanco-Arana & Salvador Pérez-Moreno, 2017. "Dynamics of child poverty in the European countries," Working Papers 437, ECINEQ, Society for the Study of Economic Inequality.
    3. Rebecca Jean Emigh & Cynthia Feliciano & Corey O’Malley & David Cook-Martín, 2018. "The Effect of State Transfers on Poverty in Post-Socialist Eastern Europe," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 138(2), pages 545-574, July.
    4. Iryna Kyzyma, 2020. "How Poor Are the Poor? Looking beyond the Binary Measure of Income Poverty," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 18(4), pages 525-549, December.

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    More about this item

    Keywords

    Poverty exit and entry; Poverty duration; Public cash transfers;
    All these keywords.

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies

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