In-Work Poverty: Role of Capitalist Institutions in Central Europe

In-work poverty has become a profound problem in Europe. With the increasing share of people in atypical jobs the risk of falling into in-work poverty is increasing. This paper investigates the state of in-work poverty in Central Eastern Europe before and after the global economic crisis. The study applies the multilevel modelling approach to estimate the effects of individual characteristics on in-work poverty, mainly the job-related characteristics, from the policies and other national-level factors. This research answers which labour market institutions and social policy measures increase the probability of working people to escape the risk of poverty. Subsequently the analysis looks at two years, 2006 and 2012, and compares the selected influences. EU-SILC dataset and logistic regression is used to perform the analysis. Preliminary findings show that the more regulated labour market institutions less is the probability of escaping the in-work poverty risk. On the other hand, higher interference in the field of social policy leads to better chances of people escaping the in-work poverty risk. Finally the findings show that the regime typology of ‘Varieties of Capitalism’ is not very helpful in understanding the country differences.