Welfare Regimes and Poverty Dynamics: The Duration and Recurrence of Poverty Spells in Europe

Abstract

This article seeks to evaluate how well the different welfare states of Europe perform in terms of preventing recurrent and persistent income poverty and what household and individual characteristics influence poverty duration. Because we use cross-national data on longitudinal poverty, we are able to increase our understanding of the effect of the institutional context within which poverty occurs. We show that country welfare regimes strongly influence long-run poverty, with social democratic countries reducing the level of persistent and recurrent poverty. Liberal and Southern European regime countries have both higher rates and longer durations of poverty. Despite their dissimilar patterns of poverty duration, European welfare states display rather similar patterns of exit from poverty, once we control for duration. There is some evidence that high initial exit rates from poverty in social democratic and corporatist countries decrease quickly whereas those in liberal and Southern European countries remain high, which could suggest lower levels of incentives in the former.