The State and Poverty Alleviation in Advanced Capitalist Democracies

Francois Nielsen, David Bradley, John D. Stephens (), Evelyne Huber () and Stephanie Moller ()

No 278, LIS Working papers from LIS Cross-National Data Center in Luxembourg

Abstract: We analyze the impact of the state on the incidence of poverty in the working-age population of 14 advanced capitalist democracies between 1970 and 1997 using an unbalanced panel design. We utilize poverty measures based on micro-level data from the Luxembourg Income Study in conjunction with pooled time series data from the Huber, Ragin and Stephens (1997) database. We argue that economic factors including de-industrialization and unemployment largely explain pre-tax, pre-transfer poverty rates of the working age population in advanced capitalist states. These rates, however, are theoretical as advanced democracies redistribute resources through taxes and transfers. We show that the extent of redistribution (measured as poverty reduction via taxes and transfers) is explained directly by welfare state generosity as well as constitutional structure (number of veto points) and the strength of the left, both in unions and in government.

Pages: 52 pages
Date: 2001-08
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Published in American Sociological Review 68, (2003): 22-51

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Persistent link: https://EconPapers.repec.org/RePEc:lis:liswps:278

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