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Second Earners and In-Work Poverty in Europe

Published online by Cambridge University Press:  08 May 2020

H. XAVIER JARA TAMAYO  and
DARIA POPOVA Open the ORCID record for DARIA POPOVA [Opens in a new window]
H. XAVIER JARA TAMAYO
Affiliation:
Institute for Social and Economic Research, University of Essex, United Kingdom, email: hxjara@essex.ac.uk
DARIA POPOVA
Affiliation:
Institute for Social and Economic Research, University of Essex, United Kingdom, email: dpopova@essex.ac.uk
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Abstract

Dual or multiple earnership has been considered an important factor to prevent in-work poverty. The aim of this paper is to quantify the impact of second earnership on the risk of in-work poverty and the role of the tax-benefit system in moderating this risk. Our analysis refers to 2014 and employs EUROMOD, the tax-benefit microsimulation model for the European Union and the United Kingdom. In order to assess the role of second earners in preventing in-work poverty we simulate a counterfactual scenario where second earners become unemployed. Our results show that the effect of net replacement rates (i.e. the ratio of household income before and after the transition of second earners to unemployment) on the probability of in-work poverty is negative and statistically significant, but in relative terms it appears to be small compared to the effects of individual labour market characteristics, such as low pay and part-time employment.

Keywords

dual earnershipsocial policyincome distributionpovertyEuropesecond earners
Type
Article
Information
Journal of Social Policy , Volume 50 , Issue 3 , July 2021 , pp. 470 - 492
Copyright
© The Author(s), 2020. Published by Cambridge University Press

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