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Anti-poverty effectiveness and efficiency of the Guaranteed Minimum Income Programme in Portugal

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  • Carlos Farinha Rodrigues

Abstract

The objective of this paper is to estimate the impact of the Portuguese Guaranteed Minimum Income (GMI) Programme on income distribution and to evaluate its effectiveness and efficiency in fighting situations of poverty and social exclusion. We estimate its impact on the distribution of household incomes and poverty as well as the amount of government expenditure necessary to finance the programme. The simulation shows that 4.8% of domestic households and 5.7% of the population are eligible to receive the GMI. The programme has a small but positive impact on reducing inequality. Similarly, analysis of the effectiveness of the GMI in terms of poverty reduction shows that it has a small but positive impact on the poverty rate. However, the most important consequences of the GMI are sharp gains in the measures of poverty intensity and severity. The efficiency indicators associated with the programme show that 85% of the transfers are awarded to poor people and that 82% of the transfers effectively contributes towards reducing the poverty gap.

Suggested Citation

  • Carlos Farinha Rodrigues, 2001. "Anti-poverty effectiveness and efficiency of the Guaranteed Minimum Income Programme in Portugal," Working Papers Department of Economics 2001/08, ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa.
    • Handle: RePEc:ise:isegwp:wp82001
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    Cited by:

    1. Margarida Chagas Lopes & Pedro Goulart, 2003. "Portuguese data on child work: what does it encompass?," Working Papers Department of Economics 2003/04, ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa.
    2. Lucía Gorjón García & Antonio Villar, 2019. "The Minimum Income Scheme as a poverty reduction mechanism:the case of the Basque Country," Studies on the Spanish Economy eee2019-10, FEDEA.
    3. Pedro Goulart, 2003. "An Overview on child Labour Determinants - The Portuguese case," Working Papers Department of Economics 2003/03, ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa.
    4. de la Rica, Sara & Gorjón, Lucía, 2017. "Assessing the Impact of a Minimum Income Scheme in the Basque Country," IZA Discussion Papers 10867, Institute of Labor Economics (IZA).
    5. O'Donoghue, Cathal & Matsaganis, Manos & Bargain, Olivier & Levy, Horacio & Mantovani, D. & Tsakloglou, P. & Mercader-Prats, M. & Baldini, Massimo & Albuquerque, J. & Bosi, P. & Farinha, C. & Rodrigue, 2002. "The impact of means tested assistance in Southern Europe," EUROMOD Working Papers EM6/01, EUROMOD at the Institute for Social and Economic Research.
    6. de Neubourg, Chris & Castonguay, Julie & Roelen, Keetie, 2007. "Social safety nets and targeted social assistance : lessons from the European experience," Social Protection Discussion Papers and Notes 41529, The World Bank.

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    More about this item

    Keywords

    Income Distribution; Inequality; Poverty Alleviation; Social Policy; Portugal.;
    All these keywords.

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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