Welfare Resilience at the Onset of the COVID‐19 Pandemic in a Selection of European Countries: Impact on Public Finance and Household Incomes
This paper assesses the impact on household incomes of the COVID‐19 pandemic and governments’ policy responses in April 2020 in four large and severely hit EU countries: Belgium, Italy, Spain and the UK. We provide comparative evidence on the level of relative and absolute welfare resilience at the...
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| Published in: | The Review of income and wealth Vol. 68; no. 2; pp. 293 - 322 |
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| Main Authors: | , , , , , , , |
| Format: | Journal Article |
| Language: | English |
| Published: |
Canada
Blackwell Publishing Ltd
01-06-2022
John Wiley and Sons Inc |
| Subjects: | |
| Online Access: | Get full text |
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| Summary: | This paper assesses the impact on household incomes of the COVID‐19 pandemic and governments’ policy responses in April 2020 in four large and severely hit EU countries: Belgium, Italy, Spain and the UK. We provide comparative evidence on the level of relative and absolute welfare resilience at the onset of the pandemic, by creating counterfactual scenarios using the European tax‐benefit model EUROMOD combined with COVID‐19‐related household surveys and timely labor market data. We find that income poverty increased in all countries due to the pandemic while inequality remained broadly the same. Differences in the impact of policies across countries arose from four main sources: the asymmetric dimension of the shock by country, the different protection offered by each tax‐benefit system, the diverse design of discretionary measures and differences in the household level circumstances and living arrangements of individuals at risk of income loss in each country. |
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| Bibliography: | Note We thank Silvia De Poli, Adrián Hernández Martín, Manos Matsaganis, Holly Sutherland and the participants to the EUROMOD Research Workshop (2020) and the OECD‐WISE seminar (2020). The support of the Collegio Carlo Alberto is acknowledged. Olga Cantó and Marina Romaguera‐de‐la‐Cruz acknowledge support from the Comunidad de Madrid—H2019/HUM‐5793 and from the Spanish Ministerio de Ciencia e Innovación—PID2019‐104619RB‐C41. Sarah Kuypers, Sarah Marchal and Gerlinde Verbist acknowledge support from the Belgian Federal Public Service Social Security. We use EUROMOD (version I3.0+) which is developed and managed by the Institute for Social and Economic Research (ISER) at the University of Essex, in collaboration with the European Commission—JRC Seville and national teams. We are indebted to Holly Sutherland and the many people who have contributed to the development of EUROMOD. The process of extending and updating EUROMOD is financially supported by the European Union Programme for Employment and Social Innovation “Easi” (2014‐2020). We make use of the following microdata: the Italian and Spanish versions of the SILC data made available by ISTAT and INE; EU‐SILC made available by EUROSTAT; the Corona Study data made available by the Universities of Antwerp and Hasselt; the Family Resources Survey and Understanding Society COVID‐19 Study made available by the UK Department of Work and Pensions (DWP) via the UK Data Service; the Spanish Annual Labour Force Survey (INE), register data on monthly Social Security affiliates (Ministerio de Inclusión Social y Migraciones) and information on monthly benefits from Servicio Público de Empleo Estatal (SEPE, Ministerio de Trabajo y Economía Social). Data providers bear no responsibility for the analysis or interpretation of the data reported here. Any mistakes are the authors' only. ObjectType-Article-1 SourceType-Scholarly Journals-1 ObjectType-Feature-2 content type line 23 Note: We thank Silvia De Poli, Adrián Hernández Martín, Manos Matsaganis, Holly Sutherland and the participants to the EUROMOD Research Workshop (2020) and the OECD‐WISE seminar (2020). The support of the Collegio Carlo Alberto is acknowledged. Olga Cantó and Marina Romaguera‐de‐la‐Cruz acknowledge support from the Comunidad de Madrid—H2019/HUM‐5793 and from the Spanish Ministerio de Ciencia e Innovación—PID2019‐104619RB‐C41. Sarah Kuypers, Sarah Marchal and Gerlinde Verbist acknowledge support from the Belgian Federal Public Service Social Security. We use EUROMOD (version I3.0+) which is developed and managed by the Institute for Social and Economic Research (ISER) at the University of Essex, in collaboration with the European Commission—JRC Seville and national teams. We are indebted to Holly Sutherland and the many people who have contributed to the development of EUROMOD. The process of extending and updating EUROMOD is financially supported by the European Union Programme for Employment and Social Innovation “Easi” (2014‐2020). We make use of the following microdata: the Italian and Spanish versions of the SILC data made available by ISTAT and INE; EU‐SILC made available by EUROSTAT; the Corona Study data made available by the Universities of Antwerp and Hasselt; the Family Resources Survey and Understanding Society COVID‐19 Study made available by the UK Department of Work and Pensions (DWP) via the UK Data Service; the Spanish Annual Labour Force Survey (INE), register data on monthly Social Security affiliates (Ministerio de Inclusión Social y Migraciones) and information on monthly benefits from Servicio Público de Empleo Estatal (SEPE, Ministerio de Trabajo y Economía Social). Data providers bear no responsibility for the analysis or interpretation of the data reported here. Any mistakes are the authors' only. |
| ISSN: | 0034-6586 1475-4991 |
| DOI: | 10.1111/roiw.12530 |