The revision of anti-poverty measures in Italy

Giulia Bovini (), Emanuele Dicarlo () and Antonella Tomasi
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Giulia Bovini: Bank of Italy

No 820, Questioni di Economia e Finanza (Occasional Papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: The Italian Government has redesigned the anti-poverty measures, replacing the minimum income scheme (RdC) with a new inclusion allowance from 2024: the 'assegno di inclusione' (AdI). Based on the Bank of Italy’s microsimulation model (BIMic), fewer households can apply for this allowance because of the more stringent eligibility criteria. We provide an evaluation of the 'morning-after' effects of the reform, which hinges on the assumption that the introduction of the new scheme does not affect individual choices (labour supply, in particular). The AdI contains the incidence of absolute poverty and income inequality (as measured by the Gini index) compared with a scenario with no subsidy in place, but less than the RdC did because of the lower coverage. The static and non-behavioural nature of the model does not allow us to estimate how the reform impacts labour supply. Nevertheless, we show that the monetary disincentives to participate in the labour market fall by around one fourth for individuals belonging to the lowest quintile of the income distribution.

Keywords: basic income; poverty; redistribution; microsimulation; occupation (search for similar items in EconPapers)
JEL-codes: C15 C63 H23 H31 I32 J68 (search for similar items in EconPapers)
Date: 2023-12
New Economics Papers: this item is included in nep-cmp
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Persistent link: https://EconPapers.repec.org/RePEc:bdi:opques:qef_820_23

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