The Working Poor in Europe
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The Working Poor in Europe

Employment, Poverty and Globalization

Edited by Hans-Jürgen Andreß and Henning Lohmann

For a long time in-work poverty was not associated with European welfare states. Recently, the topic has gained relevance as welfare state retrenchment and international competition in globalized economies has put increasing pressures on individuals and families. This book provides explanations as to why in-work poverty is high in certain countries and low in others.
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Chapter 2: The Working Poor in European Welfare States: Empirical Evidence from a Multilevel Perspective

Henning Lohmann


Henning Lohmann INTRODUCTION Recent comparative research at the European Union (EU) level shows that there is a great deal of variation in the extent of in-work poverty (Bardone and Guio, 2005). However, there is not much evidence to explain this variation. The few existing comparative studies are largely descriptive without going into the causes of the observed differences at the institutional level (see Marx and Verbist, 1998; O’Connor and Smeeding, 1995; StrengmannKuhn, 2003). In contrast to the research on the working poor, there is a large body of literature concerning country-specific differences in poverty in general. Many of these studies show that country-specific variations in poverty can be explained by differences in welfare state characteristics (see, for example, Brady, 2004; Gallie et al., 2000; Kenworthy, 1999; Moller, et al., 2003). In addition, studies on the incidence of low-wage work and the distribution of earnings stress the influence of labour market institutions (see, for example, Blau and Kahn, 1996; Lucifora et al., 2005; Rueda and Pontusson, 2000). However, it is important to recognize that each strand of research addresses a different concept: some studies focus on household incomes while others look at individual earnings. When the working poor are defined as workers who live in poor households, these two concepts are combined. Hence, variations in the incidence of in-work poverty cannot be explained from one perspective alone. Therefore, in this chapter, I hypothesize that welfare state measures and labour market institutions – in particular...

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