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Decomposing Youth Poverty in 22 Countries
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F. Social Welfare, Household Composition, and
the Market
In summary, the three welfare mix components
—
household
composition, social welfare, and the market
—
shape the
opportunity structure. Conventionally, personal economic
well-being has relied on family support and market income. In
well-developed welfare states where the life course is highly
defamiliarized and decommodified, the state is a bulwark against
poverty resulting from market labor disadvantage and inadequate
family support. Although previous studies have consistently found
negative associations between comprehensive welfare resources and
poverty in children or the elderly, this observation cannot account
for youth poverty. Empirical evidence reveals high levels of youth
poverty in societies with high social expenditures (e.g., Denmark,
Finland) and low levels of poverty in countries with limited welfare
benefits (e.g., South Korea, Taiwan). Applying decomposition
analysis to cross-national data will show the contributions of
household composition, social welfare, and the relative deprivation
in market income to youth poverty differences across countries.
III. Data and Methods
To estimate the contributions of household composition, the
market, and social welfare, this research relies on data from the
Luxembourg Income Study collected in 2010, except for the data
on Japan collected in 2008 (LIS, 2010). I selected 22 countries
with consistent income and household composition data to cover a
range of social welfare regime types. Japan is included in addition
to Taiwan and South Korea to show the poverty of youth in East
Asian countries, although the Japanese data collected during the
GFC may be less comparable to the data from other countries. The
22 countries provide data on household composition and gross and
net household income components, which are required for