Social Assistance and Minimum Income Benefits: Benefit Levels, Replacement Rates and Policies Across 33 Countries, 1990-2009

Abstract

Until recently, social assistance has received relatively little attention in the comparative welfare state literature, which is remarkable given its central function in combating poverty and pursuing social inclusion. This paper explores the developments of social assistance and minimum income benefits across 14 Western European countries, 12 Central and Eastern European countries and 7 non-European countries over the period 1990-2009. First, an institutional analysis shows that eligibility conditions, work requirements and benefit sanctions vary considerably across countries. Second, relying on new indicators, our analysis shows that real benefit levels increased in most countries, whilst the net income replacement rates declined on average. This development seems to fit with a ‘making work pay’ agenda. A subsequent qualitative analysis of the policies underlying the quantitative measures indicates that the declining replacement rates do not result from benefit cuts but from relatively larger wage increases. In addition, our policy analysis indicates that work requirements and benefit sanctions have become more activating in many countries. Third, the data indicate that social assistance benefits diverged across EU and other OECD countries between 1990 and 2009. Finally, this paper seeks to make a methodological contribution to the ongoing debate on the ‘dependent variable problem’ in the welfare state literature by analysing to what extent changes in quantitative indicators reflect actual policy changes.