Welfare Generosity in Europe: A Multi‐level Study of Material Deprivation and Income Poverty among Disadvantaged Groups

The aim of this study is to analyze whether and to what extent welfare generosity moderates the risk of income poverty and material deprivation among disadvantaged groups, that is, people with ill health, low education and lack of employment. The data are based on the 2009 European Union Statistics on Income and Living Conditions (cross‐sectional) surveys. The analyses comprise 27 and 28 European countries, including 292,874 and 302,343 individuals between 18 and 64 years of age. Multi‐level analyses demonstrated that welfare generosity moderated the risk of both material deprivation and income poverty. With few exceptions, the risk decreased among disadvantaged groups in absolute terms. Among individuals who experienced the combinations of limiting long‐standing illness and either low education or non‐employment, the absolute inequalities in material deprivation decreased with increasing welfare generosity. Also, the absolute inequalities in income poverty among individuals who experienced the combination of limiting long‐standing illness and low education were lower in more generous welfare contexts. Results indicated lower absolute levels of both material deprivation and income poverty among disadvantaged individuals in generous welfare states. However, for material deprivation the results were more substantial and consistent than for income poverty. Taken together, these findings support the view that generous welfare states reach the worst‐off and are successful in buffering material deprivation and income poverty and, hence, in reducing social inequalities.