The paper focuses on the support given through tax and benefit systems to families with children and addresses how the size and impact on the income distribution of this kind of support can be accurately measured. While such support is usually measured in rather narrow terms by adding up the benefits explicitly labelled as being for children, we adopt a more comprehensive approach whereby all tax-benefit instruments (or their components) which are contingent on the presence of children are accounted for. We use EUROMOD, the European Union tax-benefit microsimulation model, to quantify the support for children and analyse its impact on household incomes and child poverty for 19 countries. We find that the conventional approach underestimates on average the total amount of support for children by about one fifth. Furthermore, accounting for the net effect of the full range of components of cash support makes little difference in some countries but a lot more in others. For cross-national comparisons it is therefore critical that a comprehensive measure is adopted.
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Paper provided by EUROMOD at the Institute for Social and Economic Research in its series EUROMOD Working Papers with number
EM6/09.
Length: Date of creation: 22 Oct 2009 Date of revision: Handle: RePEc:ese:emodwp:em6/09
Note: European Union, Child poverty, Taxes and cash benefits, Children Contact details of provider: Postal: RAB Butler Building, University of Essex, Wivenhoe Park, Colchester, ESSEX C04 3SQ Phone: +44 (0)1206 872957 Fax: +44 (0)1206 873151 Email: Web page: http://www.iser.essex.ac.uk/research/euromod/ More information through EDIRC
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Find related papers by JEL classification: C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Microeconomic Data D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
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