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Social Protection and Economic Development: Are the Poorest Being Lifted-Up or Left-Behind?

Author

Listed:
  • Martin Ravallion
  • Dean Jolliffe
  • Juan Margitic

Abstract

Standard measures of poverty may reveal nothing about whether the poorest of the poor are being lifted-up or left-behind, yet this is a widespread concern among policy makers and citizens. The paper assesses whether public spending on social protection benefits the poorest and hence lifts the floor, and what role economic development plays. Evidence is presented for the developing world and the US. Across developing countries, a higher mean income comes with a higher floor. The bulk of this income effect is direct rather than via higher spending on social protection. That spending generally lifts the floor though this is mainly due to social insurance; on average, social assistance adds only 1.5 cents per day to the floor. Turning to the US, the paper finds that the floor has been sinking over the last 30 years, associated with an inequitable growth process. Food stamp spending partially compensates the poorest, and helped stabilize the floor in the wake of the 2008 financial crisis. The poorest in the US gain more from food stamps than average spending on food stamps, though the program’s impact on the floor per $ spent has fallen over time.

Suggested Citation

  • Martin Ravallion & Dean Jolliffe & Juan Margitic, 2018. "Social Protection and Economic Development: Are the Poorest Being Lifted-Up or Left-Behind?," NBER Working Papers 24665, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:24665
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    Cited by:

    1. Paul,Boban Varghese & Dutta,Puja Vasudeva & Chaudhary,Sarang, 2021. "Assessing the Impact and Cost of Economic Inclusion Programs : A Synthesis of Evidence," Policy Research Working Paper Series 9536, The World Bank.
    2. Palacios, Robert & Robalino, David A., 2020. "Integrating Social Insurance and Social Assistance Programs for the Future World of Labor," IZA Discussion Papers 13258, Institute of Labor Economics (IZA).
    3. Francesco Burchi & Markus Loewe & Daniele Malerba & Julia Leininger, 2022. "Disentangling the Relationship Between Social Protection and Social Cohesion: Introduction to the Special Issue," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(3), pages 1195-1215, June.
    4. Dianah Ngui & Njuguna Ndung'u & Abebe Shimeles, 2023. "Poverty, Inequality and Social Protection Programs in Africa: Lessons from the COVID-19 Pandemic," Journal of African Economies, Centre for the Study of African Economies, vol. 32(Supplemen), pages 3-9.

    More about this item

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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