Working poor trajectories
AbstractTo analyse in-work poverty, we build a model in which human capital and productivity varies over time with experience, time-related obsolescence and poverty. The model reveals four possible trajectories: poverty to exclusion; permanent poverty; the emergence from poverty; poverty to non-poor worker and back to poverty. It also generates the main traits of in-work poverty in terms of skill, age, duration, and family characteristics. Both skill-biased technical change and globalisation boost in-work poverty and exclusion. When unemployment compensation is introduced, being a poor worker can be a rational choice for individuals who accept lower pay today to earn more tomorrow.
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Bibliographic InfoPaper provided by ECINEQ, Society for the Study of Economic Inequality in its series Working Papers with number 280.
Length: 23 pages
Date of creation: Nov 2012
Date of revision:
Exclusion; poverty; working poor.;
Find related papers by JEL classification:
- I32 - Health, Education, and Welfare - - Welfare and Poverty - - - Measurement and Analysis of Poverty
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-01-07 (All new papers)
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