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This article aims to provide an overview of the main mechanisms underlying the non-take-up of public provisions by bringing together insights from existing theoretical models and the large body of empirical evidence within Europe and the U.S. We draw on studies based on the rational choice model as well as on insights from psychology and behavioural economics. Whereas most studies are confined to the client level only to explain non-take-up, an important focus of attention here is the way policy design and administration can affect the uptake of public provisions, as well as the role the broader social context plays in understanding non-take-up. In this article, we bring different strands in the literature together and develop a theoretical framework which lists and links the various mechanisms at play. At the same time, we summarise most important empirical findings on the drivers of non-take-up, and focus on lessons from the literature regarding how policies could be redesigned to reduce non-take-up.

AbstractThis article assesses the current variation in activation strategies directed towards able‐bodied persons of working age relying on a minimum income guarantee in 19 EU member states. First, we argue that the active inclusion notion developed by the European Commission in its Recommendation on the active inclusion of persons excluded from the labour market provides a useful tool to categorize current activation strategies towards minimum income protection (MIP) recipients. Consequently, we assess the empirical viability of active inclusion strategies in a fuzzy set ideal type analysis of purpose‐collected institutional data. We find that there are only few countries where the activation discourse has remained a dead letter. Most countries implement policy measures that aim to discourage benefit dependency among MIP recipients. Nevertheless, behind the realities of activation strategies towards MIP recipients seldom lies the notion of active inclusion as defined by the European Commission. Particularly, many countries focus predominantly on incentives to increase labour market participation rates of MIP recipients, rather than enabling measures.

Poverty rates in the EU have not fallen in recent decades, but have stagnated or even increased. There are indications that the erosion of social benefits may be an important factor explaining the poverty standstill. As a result, a number of recent studies on poverty trends have formulated the recommendation that minimum income protection standards be defined at the EU level. In this article we argue that there are good reasons to assume that the adequacy of guaranteed minimum income schemes may become the subject of the first legislative and legally binding initiative in the field of social protection. First, the topic has already featured prominently in the European policy debate since the early 1990s. Second, most Member States already have minimum income schemes in place. Finally, research suggests that an effective anti-poverty strategy essentially includes adequate income protection. However, between dream and reality there stand concepts and technical and budgetary considerations. Therefore any binding agreement with regard to minimum incomes would have to be formulated flexibly and introduced gradually.

In recent years simulation models are increasingly used in research on socio-economic policy, particularly in studies of taxes and social benefits. In this article we present two types of simulation models: the standard simulation model and the micro simulation model. Both models are micro models, meaning that they assess the structure and impact of social and economic policy measures for an individual decision unit (individuals, households and enterprises). We discuss the particularities of both models, point out that they are fully complementary and illustrate them with analyses of Belgian taxation and social contributions.

Scholarly literature is inconclusive on how economic crises impact on minimum income protection. Earlier studies found small increases in the generosity of safety nets at the onset of the crisis. Yet an increased focus on budget austerity substantially altered the social policy context. This paper assesses how minimum income floors weathered the austerity tide following the crisis using purpose-collected data for 23 EU countries. Generally, social assistance benefit trends did not deviate much from pre-crisis growth levels. Yet retrenchment did occur through more technical measures, the combined impact of which was quite significant in some countries.

Abstract Scholarly literature is inconclusive on how economic crises impact on minimum income protection. Earlier studies found small increases in the generosity of safety nets at the onset of the crisis. Yet an increased focus on budget austerity substantially altered the social policy context. This paper assesses how minimum income floors weathered the austerity tide following the crisis using purpose-collected data for 23 EU countries. Generally, social assistance benefit trends did not deviate much from pre-crisis growth levels. Yet retrenchment did occur through more technical measures, the combined impact of which was quite significant in some countries. Jel codes: I380

A commonly heard proposal in academic and policy circles alike is for the introduction of an obligation for all Member States to guarantee a dignified minimum income to their citizens. The accelerated integration that has taken place over the past two decades, the consistent and repeated presence of the necessity of adequate minimum income protection in European political discourse, and the EU2020 poverty targets strongly suggest that, if a decisive step is ever made towards binding measures in the field of social security, then it is quite likely to involve arrangements regarding minimum incomes. In this article we consider the impact of the introduction of such an arrangement at the European level. We identify four obstacles to overcome. First is the uncertainty over the most appropriate way of defining an adequate minimum income. Secondly, the budgetary burden of raising social assistance benefits would be quite substantial, especially in the poorer Member States. Thirdly, improving minimum income protection for the unemployed would generate significant unemployment traps. Finally, it is argued that the legal, and especially the political, feasibility of a Directive on Minimum Income that would be legally binding for the Member States remains highly uncertain. We therefore conclude that, given the great heterogeneity between countries, any binding instrument on minimum income will have to be worded flexibly, introduced gradually, and implemented in unison with a convergence in activation measures and minimum wages. Arguably, in this context, priority should be given to measures aimed at covering the minimum costs of child-rearing, restricted in an initial phase to guaranteeing to all families with children an income equal to 40 per cent of median standardised income.

The present economic crisis comes against the background of decades of policy changes that have generally weakened the capacity of social safety nets to offer citizens with adequate resources for financial survival when labour markets fail to do so. Building on data for 24 European Union countries, this paper asks whether EU governments implemented additional measures during the first phase of the crisis to improve safety nets. Our data, drawn from a large network of national experts, show that many countries introduced supportive measures, in particular in the form of additional increases in gross minimum income benefits. More generous child benefits have also helped to increase net disposable incomes of families on minimum income. Behavioral requirements imposed on minimum income recipients have been neither tightened nor relaxed. In a limited number of countries, activation efforts aimed at minimum income recipients have been intensified. Despite some improvements, social safety nets in Europe remain far below widely accepted poverty thresholds, including the EU's own official measure.

This paper introduces the Hypothetical Household Tool (HHoT), a new extension of EUROMOD, the tax-benefit microsimulation model for the European Union. With HHoT, users can easily create their own hypothetical data, which enables them to better understand how policies work for households with specific characteristics. The tool creates unique possibilities for an enhanced analysis of taxes and social benefits in Europe by integrating results from microsimulations and hypothetical household simulations in a single modelling framework. Furthermore, the flexibility of HHoT facilitates an advanced use of hypothetical household simulations to create new comparative policy indicators in the context of multi-country and longitudinal analyses. In this paper, we highlight the main features of HHoT, its strengths and limitations, and illustrate how it can be used for comparative policy purposes.