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Why rising tides dont lift all boats? An explanation of the relationship between poverty and unemployment in Britain


  • Simon Burgess
  • Karen Gardiner
  • Carol Propper


Abstract: This paper is motivated by the lack of any obvious relationship between aggregate poverty and unemployment in Great Britain. We derive a framework based on individuals' risks of unemployment and poverty, and how these vary over the economic cycle. Analysing the British Household Panel Survey for 1991-96, we are able to square the micro evidence - that unemployment matters for poverty - with the macro picture - that there's no strong link. We then go on to identify which household and individual characteristics are associated with whether an individual's poverty risk is vulnerable to the economic cycle.

Suggested Citation

  • Simon Burgess & Karen Gardiner & Carol Propper, 2001. "Why rising tides dont lift all boats? An explanation of the relationship between poverty and unemployment in Britain," CASE Papers case46, Centre for Analysis of Social Exclusion, LSE.
  • Handle: RePEc:cep:sticas:case46

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    References listed on IDEAS

    1. Signe-Mary McKernan & Robert I. Lerman & Nancy Pindus & Jesse Valente, 2000. "The Relationship between Metropolitan and Nonmetropolitan Locations, Changing Welfare Policies, and the Employment of Single Mothers," JCPR Working Papers 192, Northwestern University/University of Chicago Joint Center for Poverty Research.
    2. Sheldon H. Danziger (ed.), 1999. "Economic Conditions and Welfare Reform," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number ecwr, November.
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    Cited by:

    1. Anderson, Gordon, 2012. "Boats and tides and "trickle down" theories: What economists presume about wellbeing when they employ stochastic process theory in modeling behavior," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 6, pages 1-44.

    More about this item


    Poverty; unemployment; economic cycle;

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles


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