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Labour Income, Social Transfers and Child Poverty

Bruce Bradbury (), Markus Jäntti () and Lena Lindahl ()

No 707, LIS Working papers from LIS Cross-National Data Center in Luxembourg

Abstract: This paper documents the variation in living standards of the poorest fifth of children in rich (and some middle-income) nations, with a focus on the relative importance and interaction of social transfers (net of taxes) and labour market incomes. Overall, the cross-national variation in the disposable income of disadvantaged children is comprised equally of variation in market and transfer income (with the two negatively correlated). The English-speaking countries stand out as all having relatively low market incomes, but substantial variation in transfer income. Their low market incomes reflect low employment hours in Australia and primarily low hours in the UK and Ireland, while in the US and Canada low hours and low pay contribute equally. Comparing incomes prior to and after the 2008 financial crisis, the real disposable incomes of the poorest fifth decreased substantially in Spain and in Ireland, but were relatively stable in other rich nations.

Keywords: poverty; social transfers; wages; cross-national comparisons; LIS database (search for similar items in EconPapers)
JEL-codes: I32 I38 J21 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eur and nep-lma
Date: 2018-09
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Published in -Social Indicators Research (2018): 1-26.

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