Social Expenditures and Poverty in Central and Eastern European Union Countries: A Causality Analysis

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Global wealth has increased significantly in recent years. However, poverty and income inequality has stayed at high levels in some countries despite the global economic expansion in the world during the past four decades. In this regard, extensive measures by national governments and international institutions have been taken to combat with poverty and income inequality at national and international levels. Social protection expenditures by governments are one of the prevailing policies to decrease the poverty and inequality in the world. This study examines the causal relationship between social expenditures and poverty in selected Central and Eastern European Union countries during 2005–2014 period employing causality analysis. We found that there was no causal interaction between social expenditures and poverty in our sample.