How welfare affects the ‘inheritance’ of poverty

Intergenerational factors have the biggest influence on income poverty in 'liberal' and southern European welfare regimes, according to a study funded by the European Commission.

The study analysed the relationship between poverty and social exclusion (on the one hand) and parental characteristics and childhood economic circumstances (on the other), using data from the EU-SILC 2005. It compared findings from one-dimensional and multi-dimensional approaches to poverty and social exclusion, in order to assess how far different welfare regimes affect the intergenerational transmission of disadvantage.

Key findings

  • The weakest link between parental factors and later poverty/social exclusion is found in countries with social democratic welfare regimes (such as the Nordic countries), whereas the strongest link is found in 'liberal' regimes (such as the UK) and southern Europe.
  • The pattern of variation for economic vulnerability, in relation to both parents’ social class and childhood economic circumstances, is generally sharper than in the case of income poverty.
  • Economic vulnerability levels are significantly higher in every welfare regime for those who experienced difficult economic circumstances in childhood.
  • The author warns, however, that 'serious problems' and 'major reservations' over data quality mean the analysis results must be treated with considerable caution.

Source: Brian Nolan, Analysing Intergenerational Influences on Income Poverty and Economic Vulnerability with EU-SILC, Discussion Paper 46, GINI Project (European Commission)
Link: Paper

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