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The child supplement for low-income earners – an example of deficient co-ordination in the German transfer system

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  • Wolfgang Meister

Abstract

In addition to the basic protection provided for job seekers (Arbeitslosengeld II), a child allowance was also introduced in Germany on 1 January 2005. This article examines the effect of this new social benefit for a number of family types in connection with rent subsidies and in dependency on gross wages. In light of the numerous discrepancies revealed in the analysis – both in the design of the child allowance and because of its effects on the tax and transfer system in general – the child supplement should be re-examined by the Federal Government in connection with the designing of a combi-wage model set to take place this autumn.

Suggested Citation

  • Wolfgang Meister, 2006. "The child supplement for low-income earners – an example of deficient co-ordination in the German transfer system," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 59(16), pages 12-20, August.
    • Handle: RePEc:ces:ifosdt:v:59:y:2006:i:16:p:12-20
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    1. repec:ces:ifosdt:v::y:2006:i::p:06-27 is not listed on IDEAS
    2. Hans-Werner Sinn & Christian Holzner & Wolfgang Meister & Wolfgang Ochel & Martin Werding, 2006. "Activating social welfare 2006 - the combi-wage model of the Ifo Institute," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 59(02), pages 06-27, January.
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    Cited by:

    1. Katharina Wrohlich, 2008. "Familie und Bildung in der Agenda 2010: Ziele, Maßnahmen und Wirkungen," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 77(1), pages 90-97.
    2. Hans-Werner Sinn & Wolfgang Meister & Wolfgang Ochel & Martin Werding, 2007. "Reform concepts for increasing employment in the low-income sector: an overview," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 60(04), pages 03-20, February.
    3. Boss, Alfred & Dovern, Jonas & Meier, Carsten-Patrick & Oskamp, Frank & Scheide, Joachim, 2007. "Deutsche Konjunktur: Aufschwungskräfte behalten die Oberhand," Open Access Publications from Kiel Institute for the World Economy 4095, Kiel Institute for the World Economy (IfW Kiel).
    4. Dovern, Jonas & Gern, Klaus-Jürgen & Meier, Carsten-Patrick & Oskamp, Frank & Sander, Birgit & Scheide, Joachim & Boss, Alfred, 2007. "Weltkonjunktur und deutsche Konjunktur im Herbst 2007," Kiel Discussion Papers 445/446, Kiel Institute for the World Economy (IfW Kiel).
    5. Wolfgang Meister, 2009. "New child bonus, rent subsidy reform, higher Hartz-IV social benefit payments translate into clearly increased earnings for families in particular," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 62(16), pages 19-31, August.
    6. Wolfgang Meister, 2011. "Reforms of Hartz IV, rent subsidies and wage deductions since January 2011: effects on the income of individual household types," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 64(09), pages 29-39, May.
    7. Wolfgang Meister, 2008. "The child grant reform: Some improvements - but now an even greater loss of income at the upper income ceiling," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 61(22), pages 06-13, November.
    8. Boss, Alfred, 2007. "Wohin mit den Überschüssen der Bundesagentur für Arbeit?," Kiel Working Papers 1384, Kiel Institute for the World Economy (IfW Kiel).

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    More about this item

    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth

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