Working Poor Trajectories
Journal of Income Distribution, 2012, vol. 21, issue 3-4, 83-102
To analyse in-work poverty, we build a model in which human capital and productivity varies over time with experience, time-related obsolescence and poverty. The model reveals four possible trajectories: poverty to exclusion, permanent poverty, the emergence from poverty, and finally, from poverty to non-poor worker and then back to poverty. It also generates the main traits of in-work poverty in terms of skill, age, duration, and family characteristics. Both skill-biased technical change and globalization boost in-work poverty and exclusion. When unemployment compensation is introduced, being a poor worker can be a rational choice for individuals who accept lower pay today to earn more tomorrow.
Keywords: exclusion; poverty; working poor (search for similar items in EconPapers)
JEL-codes: I32 J24 (search for similar items in EconPapers)
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Working Paper: Working poor trajectories (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:jid:journl:y:2012:v:21:i:3-4:p:83-102
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