The Impact of Policies on Poverty Dynamics.

Abstract

Abstract In this paper we model employment and poverty states as a discrete first-order Markov process, taking into account the endogeneity of schooling and of the initial states. Using this model, we asses the impact of different policies on the poverty dynamics by ex-post microsimulation. Each policy evaluated in this paper can be considered an exemplar of one of the competing paradigms guiding social policy: the traditional welfare state, the active welfare state and the knowledge-based society.Poverty dynamics; Unemployment; Markov models;