The Ins And Outs Of Poverty In Advanced Economies: Government Policy And Poverty Dynamics In Canada, Germany, Great Britain, And The United States

Comparative analysis of poverty dynamics—transitions and persistence—can yield important insights about the nature of poverty and the effectiveness of alternative policy responses. This manuscript compares poverty dynamics in four advanced industrial countries (Canada, unified Germany, Great Britain, and the United States) for overlapping six‐year periods in the 1990s, focusing on the impact of government policies. The data indicate that relative to measured cross‐sectional poverty rates, poverty persistence is higher in North America than in Europe. Most poverty transitions, and the prevalence of chronic poverty, are associated with employment instability and family dissolution in all four countries. However, government tax‐and‐transfer policies are more effective at reducing poverty persistence in Europe than in North America.