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Income mobility and support for the welfare state: Panel evidence from Germany

Author

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  • Bilal El Rafhi

    (University Paris 8)

Abstract

Previous studies on preferences for state intervention have primarily relied on cross-sectional designs, which are limited in their ability to account for time-invariant unobservables. Using panel data from the 1997–2002 German SOEP, we estimate first-difference models to assess whether medium-term income changes are associated with changes in support for public versus private provision across five domains of financial security. A one-log-point rise in real household income is associated with a decline in support for state involvement in family, unemployment, sickness, old-age, and long-term care provision by 7-11% of a scale point. Two patterns of heterogeneity emerge: (i) individuals in the bottom or top 1997 income quintile react almost twice as strongly as those in the middle ; (ii) the absolute response to income gains exceeds that to losses (p

Suggested Citation

  • Bilal El Rafhi, 2026. "Income mobility and support for the welfare state: Panel evidence from Germany," Economics Bulletin, AccessEcon, vol. 46(3), pages 1214-1236.
    • Handle: RePEc:ebl:ecbull:eb-25-00364
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    File URL: http://www.accessecon.com/Pubs/EB/2026/Volume46/EB-26-V46-I3-P100.pdf
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    JEL classification:

    • H5 - Public Economics - - National Government Expenditures and Related Policies
    • D3 - Microeconomics - - Distribution

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