Expenditure Patterns Post-Welfare Reform in the UK: are Low-Income Families Starting to Catch Up?

44 Pages Posted: 14 Jul 2008

See all articles by Paul Gregg

Paul Gregg

University of Bath - Department of Social and Policy Sciences

Jane Waldfogel

Columbia University - School of Social Work

Elizabeth Washbrook

University of Bristol

Date Written: May 2005

Abstract

In this paper we provide evidence on how the UK government's welfare reforms since 1998 have affected the material well-being of children in low-income families. We examine changes in expenditure patterns and ownership of durable goods for low- and higher-income families between the pre-reform period (1995-1998) and the post-reform period (2000-2003), using data from the Family Expenditure Survey. The methodological approach is a difference-in-difference-in-difference analysis that exploits the fact that age variation in the reforms favoured low-income families over higher-income ones and families with children age under 11 over those with older children. We find that low-income families with children are catching up to more affluent families, in their expenditures and their possession of durable goods. Moreover, expenditures on child-related items are increasing faster than expenditures on other items.

JEL Classification: I3, J18

Suggested Citation

Gregg, Paul and Waldfogel, Jane and Washbrook, Elizabeth, Expenditure Patterns Post-Welfare Reform in the UK: are Low-Income Families Starting to Catch Up? (May 2005). LSE STICERD Research Paper No. CASE099. Available at SSRN: https://ssrn.com/abstract=1159330

Paul Gregg (Contact Author)

University of Bath - Department of Social and Policy Sciences ( email )

Claverton Down
Bath, BA7 2AY
United Kingdom

Jane Waldfogel

Columbia University - School of Social Work ( email )

622 W. 113th Street
New York, NY 10025
United States

Elizabeth Washbrook

University of Bristol

University of Bristol,
Senate House, Tyndall Avenue
Bristol, BS8 ITH
United Kingdom

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