To what extent is a transition into employment associated with an exit from poverty

Abstract

Abstract: A link between lack of employment and poverty is often made implicitly, but can be difficult to enumerate in a satisfactory manner. We would therefore like to ask the question: to what extent does acquiring employment increase a poor household’s probability of exiting poverty? Register data from the entire resident population of Norway serves as the basis for this analysis, which indicates that full-time does greatly increase the probability of exiting poverty. Part-time employment also has an effect, albeit a small one. Findings with respect to transfers are compatible with certain disincentives related to employment for single mothers, although similar results cannot be found for other types of households.