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Always Poor or Never Poor and Nothing in Between? Duration of Child Poverty in Germany

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  • Michael Fertig

    ()

  • Marcus Tamm

    ()

Abstract

This paper analyses the duration of child poverty in Germany. In our sample, we observe the entire income history from the individuals’ birth to their coming of age at age 18.Therefore we are able to analyze dynamics in and out of poverty for the entire population of children, whether they become poor at least once or not. Using duration models,we allow poverty exit and re-entry to be correlated even after controlling for observable characteristics and also account for correlations with initial conditions. Our results indicate that household composition, most importantly single parenthood, and the labour market status as well as level of education of the household head are the main driving forces behind exit from and re-entry into poverty and thus determine the (long-term) experience of child poverty. However, unobserved heterogeneity seems to play an important role as well.

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Bibliographic Info

Paper provided by Rheinisch-Westfälisches Institut für Wirtschaftsforschung in its series RWI Discussion Papers with number 0056.

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Length: 36 pages
Date of creation: Jan 2007
Date of revision:
Handle: RePEc:rwi:dpaper:0056

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Keywords: Child poverty; duration analysis; unobserved heterogeneity;

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References

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  1. Ann Huff Stevens, 1995. "Climbing Out of Poverty, Falling Back In: Measuring the Persistence of Poverty over Multiple Spells," NBER Working Papers 5390, National Bureau of Economic Research, Inc.
  2. James Heckman & Pedro Carneiro, 2003. "Human Capital Policy," NBER Working Papers 9495, National Bureau of Economic Research, Inc.
  3. Aakvik, Arild & Salvanes, Kjell Gunnar & Vaage, Kjell, 2005. "Educational Attainment and Family Background," Working Papers in Economics 10/05, University of Bergen, Department of Economics.
  4. Arnstein Aassve & Simon Burgess & Matt Dickson & Carol Propper, 2006. "Modelling poverty by not modelling poverty: an application of a simultaneous hazards approach to the UK," LSE Research Online Documents on Economics 6243, London School of Economics and Political Science, LSE Library.
  5. Corak, Miles & Fertig, Michael & Tamm, Marcus, 2005. "A Portrait of Child Poverty in Germany," IZA Discussion Papers 1528, Institute for the Study of Labor (IZA).
  6. Martin Biewen, 2002. "The Covariance Structure of East and West German Incomes and its Implications for the Persistence of Poverty and Inequality," Discussion Papers of DIW Berlin 292, DIW Berlin, German Institute for Economic Research.
  7. Anne Case & Darren Lubotsky & Christina Paxson, 2001. "Economic Status and Health in Childhood: The Origins of the Gradient," NBER Working Papers 8344, National Bureau of Economic Research, Inc.
  8. Devicienti, Francesco, 2002. "Estimating Poverty Persistence in Britain," Royal Economic Society Annual Conference 2002 61, Royal Economic Society.
  9. Biewen, Martin, 2003. "Who Are the Chronic Poor? Evidence on the Extent and the Composition of Chronic Poverty in Germany," IZA Discussion Papers 779, Institute for the Study of Labor (IZA).
  10. Lawrence F. Katz & Jeffrey R. Kling & Jeffrey B. Liebman, 2000. "Moving to Opportunity in Boston: Early Results of a Randomized Mobility Experiment," NBER Working Papers 7973, National Bureau of Economic Research, Inc.
  11. Hansen, Jörgen & Wahlberg, Roger, 2004. "Poverty Persistence in Sweden," CEPR Discussion Papers 4539, C.E.P.R. Discussion Papers.
  12. Hansen, Jörgen & Wahlberg, Roger, 2004. "Poverty Persistence in Sweden," IZA Discussion Papers 1209, Institute for the Study of Labor (IZA).
  13. Miles Corak & *UNICEF, 2005. "Principles and Practicalities in Measuring Child Poverty for the Rich Countries," Innocenti Working Papers inwopa05/27, UNICEF Innocenti Research Centre.
  14. Lorenzo Cappellari & Stephen P. Jemkins, 2002. "Who Stays Poor? Who Becomes Poor? Evidence from the British Household Panel Survey," Economic Journal, Royal Economic Society, vol. 112(478), pages C60-C67, March.
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Citations

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Cited by:
  1. Walter Krämer & Gerhard Arminger, 2011. "“True Believers” or Numerical Terrorism at the Nuclear Power Plant," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 231(5-6), pages 608-620, November.
  2. Lindquist, Matthew J. & Sjögren Lindquist, Gabriella, 2008. "The Dynamics of Child Poverty in Sweden," Working Paper Series 4/2008, Swedish Institute for Social Research.
  3. Zabel, Cordula, 2011. "Lone mothers' participation in labor market programs for means-tested benefit recipients in Germany," IAB Discussion Paper 201114, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  4. REINSTADLER Anne & RAY Jean-Claude, 2010. "Macro Determinants of Individual Income Poverty in 93 Regions of Europe," CEPS/INSTEAD Working Paper Series 2010-13, CEPS/INSTEAD.
  5. Marcus Tamm, 2010. "Child Benefit Reform and Labor Market Participation," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 230(3), pages 313-327, June.
  6. Kerstin Schneider & Claudia Schuchart & Horst Weishaupt & Andrea Riedel, 2011. "The effect of free primary school choice on ethnic groups – Evidence from a policy reform," Schumpeter Discussion Papers sdp11007, Universitätsbibliothek Wuppertal, University Library.
  7. KYZYMA Iryna, 2013. "Changes in the patterns of poverty duration in Germany, 1992-2009," CEPS/INSTEAD Working Paper Series 2013-06, CEPS/INSTEAD.
  8. Nguyen, Cuong Viet & Vu, Linh Hoang, 2014. "Should Parents Work Away from or Close to Home? The Effect of Temporary Parental Absence on Child Poverty and Children’s Time Use in Vietnam," MPRA Paper 52877, University Library of Munich, Germany.
  9. Marjan Maes, 2013. "Poverty persistence among the elderly in the transition from work to retirement," Journal of Economic Inequality, Springer, vol. 11(1), pages 35-56, March.
  10. Devicienti, Francesco, 2002. "Estimating Poverty Persistence in Britain," Royal Economic Society Annual Conference 2002 61, Royal Economic Society.

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