Means-tested Social Assistance Research Articles

Germany: The Self-Sufficient Entrepreneur Trope and the Pandemic Gnawing Away at It

The German response to the threat which the Covid-19 crisis has posed to self-employed workers reflects an approach which so far has largely focused on the prevention of bogus self-employment. While this approach has been further reinforced, to the point where the use of self-employed contractors has been banned outright in individual occupations, plummeting incomes of the ‘genuine’ self-employed remained unaddressed in the government’s crisis response for almost one year. The contribution describes the evolution of this approach as the pandemic progressed, and discusses whether the experience of this crisis may constitute a turning point in a policy tradition which has so far relegated the self-employed to the bare minimum of fully means-tested social assistance benefits when facing macroeconomic shocks as well as individual social risks. In-Work Poverty in Germany, Self-Employed Workers, Bogus Self-Employment, Covid-19 Income Support Schemes, Social Assistance Benefits, Macroeconomic Shocks

Is There Room for Targeting within Universalism? Finnish Social Assistance Recipients as Social Citizens

This article focuses on the role of means-tested social assistance in Finland, which is often considered one of the Nordic welfare states described as having a universal welfare model. The article scrutinises the capacity of the final safety net to enhance the social citizenship of social assistance recipients. The Finnish social security system combines social insurance (earnings-related benefits), universal benefits (flat-rate benefits), free or affordable public services, and social assistance as a means-tested and targeted element, and thus it is a discussion on the degree of universalism that best captures the nature of universalism in the Finnish welfare state. Because the final safety net includes public services (especially social work) and income transfers (especially social assistance), its ability to strengthen social citizenship depends on both elements—separately and as a combination—as there may be a simultaneous need for financial aid and services. Whilst national registers provide data on social assistance, there is no national register data on municipal social services, which is why a survey was conducted. In this study, the heterogenic clients supported by the final safety net were described based on an open-ended question in the survey data. Statistics were then used to evaluate the frequency of client groups (capable clients, persistent clients, invisible clients, safety net dropouts). The article concludes that universalism as a social policy principle is challenged by the diversity of the clientele.

Trapped in America's safety net: one family's struggle

When Andrea Louise Campbell's sister-in-law, Marcella Wagner, was run off the freeway by a hit-and-run driver, she was left paralyzed from the chest down. Like so many Americans-50 million, or one sixth of the country's population-neither Marcella nor her husband, Dave, had health insurance. On the day of the accident, she was on her way to class for the nursing program through which she hoped to secure one of the few remaining jobs in the area with the promise of employer-provided insurance. Instead, the accident plunged the young family into the tangled web of means-tested social assistance. As a social policy scholar, Campbell thought she knew a lot about means-tested assistance programs. What she quickly learned was that missing from most government manuals and scholarly analyses was an understanding of how these programs actually affect the lives of the people who depend on them. Using Marcella and Dave's situation as a case in point, she reveals the system's many shortcomings in Trapped in America's Safety Net. Because American safety net programs are designed for the poor, Marcella and Dave first had to spend down their assets and drop their income to near-poverty level before qualifying for help. To remain eligible, they will have to stay under these strictures for the rest of their lives, meaning they are barred from doing many of the things middle-class families are encouraged to do, such as save for retirement. And, while Marcella and Dave's story is tragic, the financial precariousness they endured even before the accident is all too common in America. Obamacare has reduced some of the disparities in coverage, but it continues to leave too many people open to tremendous risk. Beyond the ideological battles are human beings whose lives are stunted by policies that purport to help them. In showing how and why this happens, Trapped in America's Safety Net offers a way to change it.

Are Recipients of Social Assistance 'Benefit Dependent'? Concepts, Measurement and Results for Selected Countries

Means-tested Social Assistance (SA) benefits play an important role as social protection floors supporting households in financial difficulties. This paper presents evidence on the patterns of SA benefit receipt in a selection of OECD and EU countries. It provides an overview of the role of SA benefits in social protection systems and assesses the generosity of benefit payments. It then studies the dynamics of SA benefit receipt based on micro-level data describing trends in aggregate receipt and transition rates and presenting new evidence on spell durations and repeat spells. The final part of the paper summarizes recent empirical evidence on state dependence (or 'scarring effects') in benefit receipt and discusses its possible sources and policy implications.

Voluntary Public Unemployment Insurance

Denmark has drawn much attention for its active labor market policies, but is almost unique in offering a voluntary public unemployment insurance program requiring a significant premium payment. A safety net program--a less generous, means-tested social assistance plan—completes the system. The voluntary system emerged as one of many European “Ghent systems,” essentially government subsidized trade union plans, but has since lost many key features of such plans. We assess system performance using a 10% sample of the Danish population drawn from administrative data. Coverage rates for the voluntary programs are surprisingly high, approximately 80 percent of the workforce, but the program has predictable selection effects, including adverse selection across risk classes and a substantial charity hazard (low coverage among those with generous treatment under the safety net program). The latter appears to explain the difficulty of shifting to a compulsory system; redistribution effects would be concentrated among the previously uninsured in the lowest decile of the income distribution, a problem in the Danish welfare state.

Neoliberalism with a Human Face: Making Sense of the Justice and Development Party's Neoliberal Populism in Turkey

Abstract Ten years in power, the Justice and Development Party (JDP) of Turkey has displayed its commitment to a neoliberal agenda. Despite this commitment, public opinion polls reveal that the party received the majority of its votes from the poorest sections of society. Analysis of this anomaly calls for use of a theoretical concept “neoliberal populism,” whereby political leadership secures the hegemony of the power bloc dominated by the big bourgeoisie over the subordinate classes. The neoliberal dimension of neoliberal populism became manifest in the JDP's economic policies that rewarded the bourgeoisie: legalizing flexible labor, weakening welfare, and subcontracting the state's welfare provision duties to the private sector. The party displayed its populism in the form of skyrocketing means-tested social assistance programs. The JDP also made use of the symbolic/ideological sphere to constitute its hegemony by identifying the party with “common sense” in Turkey. Through embracing conservatism, Isla...

Keep going in adversity - using a resilience perspective to understand the narratives of long-term social assistance recipients in Sweden.

IntroductionIn Sweden, means-tested social assistance serves as a temporary, last resort safety net. However, increasing numbers of people are receiving it for longer periods and about a third has assistance for more than a year. The aim of this study was to explore the ways social assistance recipients manage long lasting adversity and their roles as active, rather than passive, agents in this process, using a resilience perspective.MethodThe study is based on thirteen in-depth interviews with long-term social assistance recipients from diverse areas in Stockholm County. The interviews were guided by narrative inquiry to interpret and construct stories of experiences and are part of a larger qualitative study exploring experiences of living on social assistance in Sweden.ResultsExperiences of cumulative adversity during many years compounded recipients’ difficulties in finding ways out of hardship. They had different strategies to deal with adversities, and many had underlying “core problems”, including mental health problems, which had not been properly resolved. Recipients’ showed resistance in adverse situations. Some made attempts to find ways out of hardship, whereas others struggled mainly to achieve a sense of mastering life. They received important support from individual professionals in different authorities, but mostly the help from the welfare system was fragmented.ConclusionsSocial assistance recipients in this study demonstrated agency in ways of managing long lasting difficulties, sometimes caused by “core problems”, which were often accumulated into complex difficulties. Resilience was about keeping going and resisting these difficulties. To find ways out of social assistance required help from different welfare agencies and professionals and was hindered by the fragmentation of services. This study shows that there is a need for more long-term personalised, comprehensive support, including interventions both to increase individual well-being and self-esteem and to open up opportunities for education and employment. Adequate benefit levels and overall quality of welfare services such as health and social care, day care and schools, are of major importance for those in greatest need.

Child Maintenance in the United Kingdom

Setting out the child maintenance obligations for separated families has been both a contentious and highly dynamic policy area in the UK. Since 1991 policy has been continually amended by three successive governments who have all searched for a solution to the problem of ensuring that non-resident parents make regular cash payments of child maintenance to support their children (where they can afford to do so). The UK serves as a very interesting case study in its own right as it provides a considerable amount of evidence as well as important policy lessons for other countries which might want to embark on radical change (such as the Netherlands – see Curry-Sumner this volume). Simultaneously, it is a unique policy within the UK as it is, arguably, situated awkwardly on the fringes of both the family law system and the social security system. Therein lies the tension: the boundary between public and private responsibility. Successive governments have attempted to rebalance these private and public responsibilities for supporting children in separated/lone parent families. Currently, in the latest policy formulation, the UK appears to have decoupled the private obligations of child maintenance from the public social security system (which provides means-tested social assistance benefits). This paper discusses these developments and provides new research evidence on the amounts of maintenance expected under the latest policy proposals via the use of vignette techniques.

Self‐directed and interpersonal male violence in adolescence and young adulthood: a 30‐year follow up of a Stockholm cohort

In line with Wilkinson's theory on inequality and health, this study simultaneously analyses self-directed and interpersonal violence among men in a Stockholm birth cohort born in 1953 with respect to their early life experiences of stress, their lack of social connectedness and their relative deprivation. Multinomial logistic regressions with cluster-robust variance estimates were used. Self-directed violence was found to be related to self-rated loneliness and non-membership of voluntary associations but not to a lack of friendship in school at the age of 12-13, while the opposite was shown to be true for interpersonal violence. Growing up in a family that received means-tested social assistance at least once during the period 1953-1965 was taken as an objective indicator of relative deprivation and proved to be correlated with both self-directed and interpersonal violence. Disadvantaged social comparison at the age of 12-13, taken as a subjective indicator of relative deprivation, was only statistically related to a subsequent risk of interpersonal violence. It is suggested that different types of social connectedness and relative deprivation, respectively, explain these different patterns of violence. Furthermore, the study speculates on the possibility of frequent social comparison itself being a factor to consider when trying understanding violence in general.

From Social Insurance to Social Assistance

In attempting to establish a social security system that would function to smooth the transition from a planned to market economy, the government of China has, for most of the time in the past decades, focused its efforts on setting up social insurance programs in the urban areas. Along with the emergence of urban poverty since the mid 1990s, the emphasis of the government has shifted to means-tested social assistance programs as the major means to combat poverty and maintain social stability. However, with the absence of more equitable social and economic policies that can protect people against the many risks associated with a market economy, the role of social assistance is very limited.

Early life circumstances and male suicide – A 30-year follow-up of a Stockholm cohort born in 1953

This study analyses the relationship between early life circumstances and suicide during adolescence and young adulthood among men in a Stockholm birth cohort born in 1953. Relevant variables were derived from Durkheim's proposition of social integration and suicide and Merton's strain theory of deviance. The links between our background variables and suicide were estimated with rare events logistic regression, a statistical method specially developed for situations in which rare events are endemic to the data. We found that self-rated loneliness at age 12-13 as an indicator of social isolation, school absenteeism at the same age as an indicator of school integration, and growing up in a family which received means-tested social assistance at least once during the period 1953-1965 as an indicator of childhood poverty, were statistically related to subsequent suicide risk between 1970 and 1984. Furthermore, following Bourdieu's rereading of Durkheim's Suicide, we argue that social isolation and school integration can be seen as important forms of deprivation, since "social integration" can also be understood in terms of "social recognition". This view emphasises the importance of taking the emotional and social poverty of children just as seriously as their material poverty when it comes to suicide.

Arbetslöshet som en icke önskvärd konsekvens av socialbidrag

Unemployment as an unintended consequence of social assistance recipiency: results from a time-series analysis of aggregated population dataDoes the frequency of unemployment have a tendency to increase the number of social assistance recipients, or does the relationship work the other way around? This article utilizes Swedish annual data on aggregated unemployment and means-tested social assistance recipiency in the period 1946–1990 and proposes a multiple time-series approach based on vector error-correction modelling to establish the direction of influence. First, we show that rates of unemployment and receipt of social assistance is co-integrated. Second, we demonstrate that adjustments to the long-run equilibrium are made through adjustments of the unemployment. This indicates that the level of unemployment reacts to changes in rates of social assistance recipiency rather than vice versa. It is also shown that lagged changes in the level of unemployment do not predict changes in rates of social assistance recipients in short-term. Together these findings demonstrate that the number of social assistance recipients does increase the number of unemployed in a period characterized by low unemployment and high employment.

Switzerland: High Replacement Rates and Generous Subsistence as a Barrier to Work in Old Age

During the last decade the traditionally high participation rate of elderly workers in Switzerland has remained constant for men and has increased substantially for women. Low social security implicit tax rates epitomize positive work incentives for mid- and high-income individuals, while at the same time generous means-tested social assistance make working longer than the earliest retirement age unattractive for low-income earners. A more subtle reason to retire early is the pure income effect brought about by high retirement benefits for all income groups. These high benefits together with demographic ageing are also the main reason for the unfavourable financial prospects for both the PAYG first pillar and funded occupational pension plans. Interestingly, the financial crisis has not only reduced the value of assets in the funded components of the scheme, but also uncovered structural deficiencies of the second pillar with respect to the funding ratio, regulation and supervision.

Zur Entwicklung des Anspruchslohns in Deutschland

Abstract Due to labor market reforms in Germany some years ago, the incentives to work changed. The paper analyzes the effects of the reforms on the reservation wages for specific groups. The replacement rates implied by the system of unemployment benefits and by the rules of means-tested social assistance are investigated in detail. In addition, the paper describes the development of the replacement rates in the recent decades. It turns out that the replacement rates increased in the period 1950 to 1975. Thereafter, the rates for the specific groups developed differently. However, in 2008 the rates are higher than they had been in the fifties and the sixties.

Eine angemessene Mindestsicherung in Deutschland?

AbstractDue to labor market reforms in Germany some years ago, the incentives to work changed. The paper analyzes the effects of the reforms on the reservation wages for specific groups. The replacement rates implied by the system of unemployment benefits and by the rules of means-tested social assistance are investigated in detail. In addition, the paper describes the development of the replacement rates in the recent decades. It turns out that the replacement rates increased in the period 1950 to 1975. Thereafter, the rates for the specific groups developed differently. However, in 2008 the rates are higher than they had been in the fifties and the sixties.

Does Social Assistance Recipiency Influence Unemployment?

Has the frequency of unemployment a tendency to increase the number of social assistance recipients, or does the relationship work the other way round? This article utilizes Swedish monthly data on aggregated open unemployment and means-tested social assistance recipiency in the period 1991—2004 and proposes a multiple time-series approach based on vector error-correction modelling in order to distinguish between theories about the direction of influence. First, we show that rates of unemployment and receipt of social assistance are co-integrated. Second, we demonstrate that adjustments to the long-run equilibrium are made through adjustments to the receipt of means-tested social assistance. This indicates that the frequency of social assistance recipiency reacts to changes in unemployment rather than vice versa. It is also shown that lagged changes in the number of social assistance recipients do not predict changes in rates of unemployment in the short term. Together, these findings demonstrate that the number of social assistance recipients does not increase the number of unemployed.

The choice between an annuity and a lump sum: Results from Swiss pension funds

This paper uses unique micro data from Swiss employer-based pension plans to study the annuitization decision at retirement. The administrative nature of our data, though limited with respect to individual background characteristics, allows us to analyze real choices over large retirement balances, rather than subjectively reported intentions to annuitize. We find a strong and robust impact of a utility-based measure of the annuity's value (computed within a life-cycle framework) on individual annuitization rates. Low accumulation of retirement assets is strongly associated with the choice of the lump sum, presumably due to the availability of means-tested social assistance. The sponsor's default option, in most cases the annuity, is also found to be highly influential in the decision to annuitize.

Voluntary Public Unemployment Insurance

Denmark has drawn much attention for its active labor market policies, but is almost unique in offering a voluntary public unemployment insurance program requiring a significant premium payment. A safety net program – a less generous, means-tested social assistance plan – completes the system. The voluntary system emerged as one of many European Ghent systems, essentially government subsidized trade union plans, but has since lost many key features of such plans. We assess system performance using a 10% sample of the Danish population drawn from administrative data. Coverage rates for the voluntary programs are surprisingly high, approximately 80 percent of the workforce, but the program has predictable selection effects, including adverse selection across risk classes and a substantial charity hazard (low coverage among those with generous treatment under the safety net program). The latter appears to explain the difficulty of shifting to a compulsory system; redistribution effects would be concentrated among the previously uninsured in the lowest decile of the income distribution, a problem in the Danish welfare state.

What Can Child Anthropometry Reveal About Living Standards and Public Policy? An Illustration from Central Asia

The paper considers the case for the use of data on weight and height of children to assess living standards and public policy, contrasting them with monetized measures of welfare based on household incomes or expenditures. Data on child anthropometry are then used from Uzbekistan, the most populous of the Central Asian republics of the former Soviet Union, to investigate rural–urban differences in living standards, the impact of kindergartens on nutritional status, and the targeting of means‐tested social assistance. Conclusions are drawn for the use of information on child anthropometry in the design of public policy.

Schweden: Vom „Dritten Weg“ der achtziger Jahre zur „globalisierten Sozialdemokratie“ des 21. Jahrhunderts?

There was an impact of neoliberalism on the Swedish model over the past twenty years. Its main political driving force was the social democratic party. It is argued that neoliberalism had a major impact first on the level of discourse and then, from 1990 onwards, on the policy level as well. As a result, the gap between the Swedish model and continental welfare states is found to be narrowing, the universalism of the model itself being undermined as those who can afford to do so more and more frequently choose to pay for better services on the market while others are relegated to means-tested social assistance and social services increasingly starved of resources.