AN ASSESSMENT OF THE RELATIONSHIP BETWEEN SOCIAL TRANSFERS AND INCOME INEQUALITY IN TURKEY
Senturk, Muhammet Sakir
Despite significant decrease in income inequality in the last years, Turkey still has the third highest inequality rate among the OECD countries. The distributed amount of social transfers increased in the last years significantly. In my thesis, I examine the relationship between income inequality and social transfers in Turkey in the time span between 2006 and 2013. Using the Gini coefficient as inequality measure from several rounds of the Income and Living Conditions Survey (SILC), I test the impact of social transfers on income inequality. My results indicate that an enhanced level of social transfers had a positive redistributive impact and lead to a decrease in income inequality during this period. After that, I look for the distributive impacts of the different kinds of the transfers and the eventual results are compatible with the literature: retirement and disability pensions do not decrease inequality, whereas; widow’s and orphan’s pensions decrease income inequality; analyzing sickness allowance, student grants and unemployment compensation does not return any significant results. From a policy perspective, my results indicate that allowing for a differentiated analysis is important when assessing the socio-economic viability/effectiveness of social transfer programs.
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