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The Dynamics of Social Assistance Receipt: Measurement and Modelling Issues, with an Application to Britain

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Author Info
Cappellari, Lorenzo () (Università Cattolica del Sacro Cuore)
Jenkins, Stephen P. () (University of Essex)

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Abstract

We model the dynamics of social assistance benefit receipt in Britain using data from the British Household Panel Survey, waves 1–15. First, we discuss definitions of social assistance benefit receipt, and present information about the trends between 1991 and 2005 in the receipt of social assistance benefits, and in annual rates of transition into and out of receipt. Second, we review potential multivariate modelling approaches especially the dynamic random effects probit models that are used in our empirical analysis and, third, discuss sample selection criteria and explanatory variables. Fourth, we present our regression estimation estimates and interpret them. The final section contains a summary of the substantive results, and highlights some lessons concerning application of the analysis for other countries and some methodological issues.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3765.

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Length: 73 pages
Date of creation: Oct 2008
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Handle: RePEc:iza:izadps:dp3765

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Related research
Keywords: social assistance; welfare benefits; dynamic random effects probit; income dynamics;

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Find related papers by JEL classification:
I38 - Health, Education, and Welfare - - Welfare and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data
C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Wiji Arulampalam & Mark B. Stewart, 2007. "Simplified Implementation of the Heckman Estimator of the Dynamic Probit Model and a Comparison with Alternative Estimators," IZA Discussion Papers 3039, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  2. Mary Gregory & Miriam Beblo & Wiemer Salverda & Ioannis Theodossiou, 2009. "Introduction," Oxford Economic Papers, Oxford University Press, vol. 61(suppl_1), pages i1-i10, April. [Downloadable!] (restricted)
  3. Jörgen Hansen & Magnus Lofstrom, 2006. "Immigrant-Native Differences in Welfare Participation: The Role of Entry and Exit Rates," IZA Discussion Papers 2261, Institute for the Study of Labor (IZA). [Downloadable!]
  4. Bondonio, Daniele, 2002. "Evaluating the Employment Impact of Business Incentive Programs in EU Disadvantaged Areas. A case from Northern Italy," P.O.L.I.S. department's Working Papers 27, Department of Public Policy and Public Choice - POLIS. [Downloadable!]
  5. Mundlak, Yair, 1978. "On the Pooling of Time Series and Cross Section Data," Econometrica, Econometric Society, vol. 46(1), pages 69-85, January. [Downloadable!] (restricted)
  6. Jörgen Hansen & Magnus Lofstrom & Xuelin Zhang, 2006. "State Dependence in Canadian Welfare Participation," IZA Discussion Papers 2266, Institute for the Study of Labor (IZA). [Downloadable!]
  7. Marco Francesconi & Wilbert van der Klaauw, 2007. "The Socioeconomic Consequences of "In-Work" Benefit Reform for British Lone Mothers," Journal of Human Resources, University of Wisconsin Press, vol. 42(1). [Downloadable!] (restricted)
  8. Lorenzo Cappellari & Stephen P. Jenkins, 2008. "Estimating low pay transition probabilities accounting for endogenous selection mechanisms," Journal Of The Royal Statistical Society Series C, Royal Statistical Society, vol. 57(2), pages 165-186. [Downloadable!] (restricted)
  9. Paul Gregg & Susan Harkness & Sarah Smith, 2009. "Welfare Reform and Lone Parents in the UK," Economic Journal, Royal Economic Society, vol. 119(535), pages F38-F65, 02. [Downloadable!] (restricted)
    Other versions:
  10. Jörgen Hansen & Magnus Lofstrom, 1999. "Immigrant Assimilation and Welfare Participation: Do Immigrants Assimilate Into or Out-of Welfare," IZA Discussion Papers 100, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  11. Stewart, Mark B & Swaffield, Joanna K, 1999. "Low Pay Dynamics and Transition Probabilities," Economica, London School of Economics and Political Science, vol. 66(261), pages 23-42, February. [Downloadable!] (restricted)
    Other versions:
  12. Mark B. Stewart, 2002. "The Inter-related Dynamics of Unemployment and Low Pay," 10th International Conference on Panel Data, Berlin, July 5-6, 2002 B2-4, International Conferences on Panel Data. [Downloadable!]
  13. Paul Gregg & Jane Waldfogel, 2005. "Introduction," Economic Journal, Royal Economic Society, vol. 115(501), pages F1-F6, 02. [Downloadable!] (restricted)
  14. Chamberlain, Gary, 1984. "Panel data," Handbook of Econometrics, in: Z. Griliches† & M. D. Intriligator (ed.), Handbook of Econometrics, edition 1, volume 2, chapter 22, pages 1247-1318 Elsevier. [Downloadable!] (restricted)
  15. Lorenzo Cappellari & Stephen P. Jenkins, 2004. "Modelling low income transitions," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 19(5), pages 593-610. [Downloadable!]
    Other versions:
  16. Brewer, Mike & Duncan, Alan & Shephard, Andrew & Suarez, Maria Jose, 2006. "Did working families' tax credit work? The impact of in-work support on labour supply in Great Britain," Labour Economics, Elsevier, vol. 13(6), pages 699-720, December. [Downloadable!] (restricted)
  17. Enberg, John & Gottschalk, Peter & Wolf, Douglas, 1990. "A random-effects logit model of work-welfare transitions," Journal of Econometrics, Elsevier, vol. 43(1-2), pages 63-75. [Downloadable!] (restricted)
  18. Stephen P. Jenkins, 2000. "Modelling household income dynamics," Journal of Population Economics, Springer, vol. 13(4), pages 529-567. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. repec:ese:iserwp: is not listed on IDEAS
  2. Arulampalam, Wiji & Stewart, Mark B., 2008. "Simplified Implementation of the Heckman Estimator of the Dynamic Probit Model and a Comparison with Alternative Estimators," The Warwick Economics Research Paper Series (TWERPS) 884, University of Warwick, Department of Economics. [Downloadable!]
    Other versions:
  3. Carlos Gradín & Olga Cantó, 2009. "Why are child poverty rates so persistently high in Spain?," Working Papers 123, ECINEQ, Society for the Study of Economic Inequality. [Downloadable!]
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