Private Transfers and Emerging Welfare States in East Asia: Comparative Perspectives

Empirical studies on income distribution and poverty have indicated that the public transfer system has been successful in terms of poverty and inequality reduction in welfare states. However, very little attention has been paid to private transfers in this analysis. Recently, while there has been an increasing interest in the unique features of East Asian welfare states/regimes, many scholars have begun to have an interest in the role of the family in their welfare mix. This article aims to widen the scope of comparative income studies, firstly by analyzing 12 Western welfare states and two newly emerging East Asian welfare states, i.e. South Korea and Taiwan, and secondly, by comparing the poverty and inequality reduction effects of private transfers with those of public transfers. The Luxemburg Income Study dataset is used for the analysis. The empirical results indicate that private transfers are much more effective than public transfers in terms of income inequality and poverty reduction effects in both South Korea and Taiwan, in contrast to western counterparts including three Southern European countries. Finally, based on the results, we propose further research questions.