Evaluating the impact of receiving social transfers on income poverty and deprivation in EU member states

This study examines the relationship between receipt of social transfers and poverty across EU member states, with a particular focus on income poverty as well as material and social deprivation. Although social transfers are a central component of European welfare states for poverty reduction, there is limited evidence on how transfer receipt is associated with poverty when assessed beyond income-based measures at the individual level. Recognising that poverty extends beyond the lack of income, this research combines monetary and non-monetary measures and investigates contemporaneous and lagged associations between transfer receipt and poverty outcomes.

Using longitudinal EU-SILC data (2017–2020) covering 22 EU member states, the analysis applies conditional fixed-effects and random-effects logistic regression models. A two-level approach is adopted: EU-wide models to identify general patterns and cross-national comparisons to explore variation across welfare contexts.

The findings show that receiving social transfers reduces the odds of income poverty in contemporaneous terms but has only a limited effect on deprivation. When both within- and between-individual variation are considered, recipients of social transfers are more likely to experience poverty and deprivation, possibly reflecting the targeting of transfers toward vulnerable groups but highlighting the limited capacity of transfer systems. Cross-national analysis reveals substantial heterogeneity, consistent with the idea that welfare state design influences outcomes. Findings also indicate limited evidence of a lagged association between social transfer receipt and poverty/deprivation, supporting the idea that social transfers alone are not sufficient to lift individuals out of poverty in a sustained way.

The study contributes to better understanding the role of social transfers in poverty reduction by providing new empirical insights, demonstrating the value of combining income-based and non-monetary indicators, and highlighting the importance of considering temporal effects in policy monitoring. While social transfers remain essential for alleviating income poverty, they must be complemented by integrated policy responses that go beyond monetary support to address the multidimensional aspects of poverty.