Redistributive Effect of Social Transfers in The European Union (2020 – 2024)

Abstract

Purpose: The main purpose of this article is to measure the redistributive effect of social transfers in the European Union for the period 2020 – 2024.

Design/Methodology/Approach: The methodology used includes: empirical analysis of the dynamics of the Gini coefficient of equivalised disposable income before and after social transfers in the 27 EU Member States (2020 – 2024); measurement of the relative decrease in the Gini coefficient as a result of pensions and other social transfers over time; comparative analysis of results for Bulgaria and EU 27 (average).

Findings: EU Member States have quite different degrees of inequality in income distribution before social transfers. The redistributive effect of social transfers also varies greatly across countries. Bulgaria is among the member states with the weakest redistributive effect of social transfers.

Practical Implications: The findings highlight progress in social protection and the development of the economic and social cohesion of the member states as tasks of the Union.

Originality/Value: The article will contribute to the literature on social protection and redistribution in the EU. We offer a comprehensive view of the social transfer system. In most studies, attention is focused only on pensions or only on other social transfers.

Paper Type: Research paper.