The effects of income transfers on poverty reduction in people with disabilities in South Korea

Abstract

Using a nationally representative sample dataset from the 2016 Korean Welfare Panel Study, we examined the anti‐poverty effects of income transfers in people with disabilities. Our findings indicate that in households with a person with a disability, income transfers decreased by 55.9% and 84.8% of the pre‐transfer poverty rate and poverty gap, respectively. Before income transfers, households with a person with a disability were 1.94 times more likely to be poor compared to those without a person with a disability. When income transfers were offered, the chance of being poor in the disability group was only 1.11 times higher than that in the non‐disability group. Findings from the aggregated data suggest that means‐tested income transfers were more effective in reducing poverty levels than social insurance or private income transfers. At the individual level, the provision of means‐tested programs was also more likely to decrease the likelihood of experiencing poverty than social insurance and private income transfers.