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P 1264 Effectiveness of Poverty Reduction in the EU

Poverty & Public Policy Vol.1 Iss.2 Art.5

Effectiveness of Poverty Reduction in the EU: A Descriptive Analysis

Koen Caminada, Leiden University, Leiden Law School, Department of Economics
Kees Goudswaard, Leiden University, Leiden Law School, Department of Economics

The European Union coordinates and encourages Member State actions to combat poverty, and to reform their social protection systems on the basis of policy exchanges and mutual learning (‘best practices’). This paper analyses the effectiveness of welfare state policies and especially social transfers in EU-countries in alleviating poverty. To indicate whether European economic integration may have had any impact on poverty reduction, we also include several non-EU15 countries as a benchmark into our analysis. We analyze on a cross-country basis the relationship between poverty rates and social effort, as measured by social expenditure ratios. We also correct these expenditure ratios for the impact of the tax system and for private social arrangements, using OECD methodology. Next, we compare poverty rates at the levels of market and disposable incomes; that is, before and after transfers, in order to analyze the effect of tax and transfer policies in reducing poverty, i.e., to determine the target efficiency of social transfers. We perform several tests with the most recent data.
by jpflege | 2009-08-25 10:25 | 506 poverty
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