Coherent Identifier About this item: 20.500.12592/9dk52x

Is Social Protection a Luxury Good ? (English)

13 September 2022


The claim that social protection is a luxury good-with a national income elasticity exceeding unity-has been influential. The paper tests the œluxury good hypothesis using newly-assembled data on social protection spending across countries since 1995, treating the pandemic period separately, as it entailed a large expansion in social protection efforts. While the mean income share devoted to social protection rises with income, this is attributable to multiple confounders, including relative prices, weak governance in low-income countries and access to information-communication technologies. Controlling for these, social protection is not a luxury good. This was also true during the pandemic.



social assistance social insurance world social protection and labor social protection and growth

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Is Social Protection a Luxury Good ?
Series Name
Policy Research working paper ; no. WPS 10174;
Unit Owning
Office of the Chief Economist (ECACE)
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Volume No