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Convergence of minimum benefit schemes in Europe: evidence at the micro level

Background

This project informs the EU policy agenda for greater upward convergence towards best practices in the area of minimum income benefits by exploring the implications of reforms that move national minimum income benefit systems towards common benchmarks.

Description and methods

The countries covered are Bulgaria, Estonia, Croatia, Latvia, Poland, Portugal, Slovakia and Greece and the starting point for the analysis are their 2015 tax-benefit systems. Using EUROMOD, a number of reform scenarios are simulated, namely a 25%, 50%, 75% and 100% increase in the 2015 minimum income benefit level in each country. An additional scenario considers the percentage benefit increase necessary to lift the disposable income of a single-person household with no earnings to the level of disposable income of a single- person household earning 40% of the OECD average wage.

The study estimates the first-order effects of these reforms on household income as well as their net budgetary cost and effects across the income distribution (e.g. on those at risk of financial poverty) for different household types (e.g. with versus without children, elderly vs. non elderly). The policy implications of the results and the feasibility of different reform scenarios are discussed, considering the specificities of the schemes in each of the countries of interest and the challenges for policy implementation.

Team members

Dr Chrysa Leventi

Senior Research Officer - ISER, University of Essex


Dr Mattia Makovec

Economist - World Bank (former ISER researcher)


Ms Olga Rastrigina

Senior Research Officer - ISER, University of Essex


Professor Holly Sutherland

Director of EUROMOD, Research Professor - ISER, University of Essex


Low income   laundry   credit ryan oriecuia

Photo credit: Ryan Oriecuia