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19-21 settembre 2013, Università della Calabria, Arcavacata di Rende (CS)

19-21 settembre 2013, Università della Calabria, Arcavacata di Rende (CS)

In un tempo in cui l’incertezza sul futuro condiziona drammaticamente l’Unione Europea la conferenza si interroga sulla sua integrazione sociale e politica.

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Working poor

Characteristics, policies, effects on pensions

2

2012

April - June

Description

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Why deal with working poor? One might say that those without a job are much worse off, particularly in a country like Italy where there continue to be widespread gaps in the system of social protection and where there is no safety net. But it is difficult to set up hierarchies of disadvantages, above all when various factors come together: how, for example, do we evaluate the situation of a low-paid worker who might be a little better off than someone without a job, but who earns his wage in working conditions that are dangerous or demeaning and sometimes with hours of work that seriously restrict the possibility of a family life? The new number of RPS tackles the problem from various points of view, first of all focusing on the dimensions and characteristics of working poor, in Italy above all, describing and evaluating specific corrective policies. The first section offers five contributions from economists who analyse the incidence and characteristics of lworking poor in the framework of the progress of wages, both comparatively and in Italy. The second and third sections are wholly given over to the subject of policies to tackle poverty.

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Italy and Oecd countries. Working poor and pensioners: economy labour market wages

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Market Retribution in Oecd Countries
This work aims to describe the course of salaries in the main Oecd countries during the last few decades. It considers both the dynamics of income levels and differentials. The second part of the work considers the characteristics of low-paid workers in some European countries and those of workers whose family income is at poverty level.
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Keywords: salaries :: inequality :: working poor ::

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The «White Witch» and Elusive Inequality: Salaries in Italy
The article offers an integrated year-by-year reading of the recent development of salaries in Italy, in relation both to gross incomes by contract, and «actual» («market») ones. The salient fact is the immobility of real gross earnings since the early 1990s. There are, however, some nuances to this general picture as regards the macro-areas of the economy (industry, private services, public administration). The inequality which increased in the first decade of this century is not the traditional inequality related to gender, qualifications and age. What have increased are the differentials in working hours, type of contract and area. Salary inequality is also «elusive» in Italy in structural terms, from the point of view of international comparisons. In fact, the relatively high incidence of independent work, both unofficial and in small companies, are all elements that tend to «cut the tails» of the distribution curve of salaries in statistical representations. The work ends by describing some links between the questions of income, tax and competitiveness.
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The Working Poor in Italy: How many there are, who they are, how poor they are
Using the It-Silc figures for the period 2004-2008 this article is one of the first attempts to quantify and describe the phenomenon of the working poor in Italy. It estimates the incidence and significance of the phenomenon and the main determinants of both with reference to types of poor workers: a. individuals with income from their work below the threshold b. workers with a disposable family income below the threshold considered in relation to three different poverty thresholds: 40-50-60% of the average wage. The article estimates a headcount ratio of around 12,8% in the five years 2004-2008 with income below the threshold of 60% of average income, equal to 9000 euro gross per year. The poverty gap index estimated is equal to 27% of the threshold (around 2000 euro gross per year). Working hours being equal, women, immigrants, fixed-term workers and the young are those most at risk of poverty. For the young it is estimated that, on average, the likelihood of emerging from poverty is significantly lowered only around the age of 33.
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The Early Career Years: Atypical Jobs, Poorly Paid and with Low Contributions. The Evidence of a Panel of Italian Workers
The problems concerning the vulnerability of younger workers are usually only evaluated by observing how many of them at any given moment are unemployed or employed with short-term contracts, in this way failing to analyse both whether their vulnerability also depends on low pay, and whether situations of this kind persist over time or are transitory. This article uses an innovative databank that makes it possible to observe some work histories in Italy involving a wide range of individuals, who are followed from their entry into the labour market down to more recent years, and investigates these aspects, presenting original results regarding the employment and salary dynamics characteristic of the early years of career, evaluating in particular the transitions between different employment states, the frequency of low-salary periods or unemployment, and the adequacy of the sum of contributions so far paid into the public pensions system
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Italy. From Workers to Impoverished Pensioners: Welfare Protection Measures
This contribution aims to describe the current state of the law in relation to support for poor pensioners, supply elements of analysis that can identify the typology of future poor pensioners, and advance proposals for reforming welfare measures for future pensioners, those who will be totally contributory. The analysis reveals that situations of suffering and economic deprivation will be concentrated among workers who at the age of 70 will have accumulated fewer than 30 years of contributions. Welfare measures could usefully be reformed, extending contribution payments to all workers in periods of unemployment. In addition, the principle of enhancing contributions made could be restored. That principle was completely eliminated for poor pensioners following the overlapping of different measures over the years.
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Keyword

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Work and Inquality
The inequality that is created in the labour market explains a very high proportion of the overall inequality in disposable incomes. Starting from this observation, the article presents a summary of the characteristics of inequality in incomes from labour, partly with a view to verifying, in a perspective of inequality, if the functioning of this market complies with what is theorized in the main theoretical approaches, or if there are significant divergences, with potentially important consequences for the characteristics and acceptability of inequality as well as for the planning of more effective policies to combat it.
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Lecture

A Bit Rich. Calculating the Real Value of the Professions for Society. A Report by Nef (New Economic Foundation)
After an introduction on the extent and development of income inequalities and a short summary of some principles of Ricardo’s theory of wage fixing and Marx’s of surplus value, what follows – kindly made available to us by the authors and the British Nef research centre – analyses a series of widespread economic and cultural myths behind the social legitimization of wage inequalities. In examining each of the ten myths, the article considers various professions that have very different retributions and social consideration, exemplifying the myth in question. In conclusion, the authors suggest a list of guidelines and possible measures that would reduce the disparity in consideration and the inequalities in wages.
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The phenomenon: sociological analyses and European policies

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The Working Poor. A Review of Sociological Studies
The article offers to describe the main lines of the question of the working poor, dealing with some interpretations, identifying different perspectives and drawing attention to some important elements of analysis chosen from the literature on the subject. The research examined shows the complexity and multidimensional nature of the phenomenon. It is the co-presence of several risk factors, at micro and macro level, that generates working poverty both directly and indirectly. Finally, the article argues for the social significance and great relevance of the subject and suggests it be made a specific object of empirical research.
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Keywords: labour market :: poverty :: vulnerability ::

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Income Support for Poor Workers. A Review of the Main Measures used in the Eu
The article deals with so-called in-work benefits, or employment conditional benefits: income-support measures intended for working poor. They are programmes aimed both at reducing the poverty of workers and/or their families, in particular those with children, redistributing resources towards low-income classes, and also encouraging employment. Starting from the literature on the subject, the article first reviews the programmes of this kind in European countries, and then examines income-support measures in the United Kingdom, Ireland, Belgium and France. It concentrates in particular on the type of benefits, the beneficiaries, conditions of eligibility and their main characteristics.
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Working poor. Income-support policies

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Income Support for Poor Workers: A Self-Evident Measure of Social Justice?
In these last decades, in-work benefits have been widely adopted in many Oecd countries, supported by a quasi-unanimous consensus as if their justifications were substantially self-evident. Italy shows various shortcomings on this front, even though not being immune from in-work poverty. On the contrary, working poor risk to increase in the current economic situation. An evaluation of in-work benefits, thus, appears useful in order to inform future policy choices. Focusing on the evaluation of the principles of social justice that could justify such policies, the article discerns three possible blocs of motives. Acknowledging the plurality of motives is important also because, depending on the choice made, the implications for policy design could vary.
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Income Support for Poor Workers, from the Point of View of Efficiency
This article is a contribution to the literature studying the possible tools for combating poverty. After tracing the main lines of «Making work pay» (Mwp) schemes, there is an analysis of the main features of Earned income tax credit (Eitc). The aim is to clarify how Eitc, which aims to redistribute wealth, also determines responses from economic agents that have a strong effect on efficiency. The work brings out how, on the basis of the theory of optimum taxation, the Mwp schemes can have effects in terms of efficiency in two different ways. The first concerns the risks linked to the creation of inefficiency traps (inactivity, unemployment, poverty), while the second concerns the contrasting effects of Eitc in relation to the extensive margin (being part of the labour market or not) and the intensive margin (variation in hours worked). The possibility of being able to reconcile redistribution and efficiency is still an open debate, useful for guiding the preparation of optimum policies of income support.
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A Revision of Income Tax to Stimulate the Labour Market
There is widespread agreement as to the desirability of lowering the actual marginal tax rates imposed on low work incomes, both for redistributory reasons (low income support and reduction of the growing gap in primary distribution), and to encourage job supply, which is regarded as particularly reactive for low income levels, especially for women and those in southern Italy. Given the stringent budget constraints, we can imagine a moderate rethinking of the rates (slight reduction of the first three and slight increase of the last two), as well as a less marked decrease in work allowances, compensated by a halving of other allowances. The results show an overall easing of 1 billion, with noticeable benefits both for low and medium incomes, and for the actual marginal rates, which would go down 4 points for incomes up to 15,000 euros a year.
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Off topic

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Active Labour Policies in Western Europe: Conceptions and Development
The objective of this article is to provide an account of the development of active labour market policy in six western European countries, Sweden, Denmark, Germany, France, Italy and the Uk. It shows that active labour market policies are not entirely a new idea, and that attempts to intervene directly in the functioning of the labour market have happened as early as in the 1950s. However, the shape taken by these interventions has changed over time. In general, one can say that policy does follow changes in labour market problems. However, the adaptation of policy is generally slow. In addition, political factors may accelerate or slow down the pace of the reorientation.
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Features

Observatory Europa
Observatory Europa. Periodical Note of Information on the Main News Concerning the Eu’s Social Action
Recent months have been marked by the desire to further strengthen the coordination of economic and budgetary policy in the Second European Semester. The other significant feature has been the renegotiation of the treaty that set up the European Stability Mechanism (Esm) and the movement towards an international treaty between the member states of the euro zone. At the same time, the member states of the Union are trying to define a development plan that will go beyond rigour, underlining the importance of investments for the young. The few measures in the social field ate linked to a re-launch of growth. These include the White Book on pensions, the declaration of the Council of Ministers of Labour and Social Policies (Epsco) and the conclusion of the tri-partite social summit. In this number we shall also see some novelties in social security, in particular concerning the posting of workers and the coordination of the rights of migrant workers. One final point concerns the action of the existing international organizations.
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