How Tight Are Safety-Nets in Nordic Countries? Evidence from Finnish Register Data

Olivier Bargain, Herwig Immervoll and Heikki Viitamäki ()
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Heikki Viitamäki: VATT, Helsinki

No 3004, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: The non take-up of social assistance benefits due to claim costs may seriously limit the anti-poverty effect of these programs. Yet, available evidence is fragmented and mostly relies on interview-based data, potentially biased by misreporting and measurement errors on both benefit entitlement and income levels used to assess eligibility. In this paper, we use Finnish administrative data to compare eligibility and actual receipt of social assistance by working-age families during the post-recession period (1996-2003). Possible errors due to time-period issues and discretionary measures by local agencies are carefully investigated. Non take-up is found to be substantial – between 40% and 50% – and increasing during the period. Using repeated cross-section estimations, we identify a set of stable determinants of claiming behavior and suggest that the increasing trend is mainly due to a composition effect, i.e. a decline in the proportion of groups with higher claiming propensity. We finally discuss the targeting efficiency of the social assistance scheme.

Keywords: register data; poverty; social assistance; take-up (search for similar items in EconPapers)
JEL-codes: D31 H31 H53 I38 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2007-08
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Published - substantially revised version: IZA DP 5355 / published in: Journal of Economic Inequality , 2012, 10 (3), 375-395

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Related works:
Working Paper: How Tight are Safety-Nets in Nordic Countries? Evidence from Finnish Register Data (2007)
Working Paper: How tight are safety-nets in Nordic countries?: evidence from Finnish register data (2007)
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