Author ORCID Identifier

http://orcid.org/0000-0002-3672-2131 : Nazim Habibov

Document Type

Article

Publication Date

3-1-2006

Publication Title

Journal of Sociology and Social Welfare

Volume

33

Issue

1

First Page

203

Last Page

226

Keywords

Income distribution, welfare, poverty, inequality, safety net, social assistance, transition, and Azerbaijan

Abstract

Although low-income countries in transition are facing the challenges of poverty and inequality, evidence on the performance of safety nets in these countries is scarce. This article uses micro-file data from a nationally representative household budget survey to analyze the existing social assistance programs in Azerbaijan, a low income country in transition, from the perspectives of poverty and inequality reduction. The empirical evidence presented in this paper indicates that the poverty and inequality reduction effectiveness of social assistance programs is inadequate. First, the benefits are very modest and the poor receive only a small proportion of them. Second, some programs are not aimed at poverty reduction by design. Third, the heterogeneous nature of poverty and the significant scale of shadow economy during transition make the identification of the poor complicated. Finally, the existing patchwork of numerous programs with small-scale benefits is costly and administratively demanding. A consolidated and better designed social assistance program is needed to effectively tackle the challenges of poverty and inequality in Azerbaijan.

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