This chapter looks at the issues that concern the regional variations in poverty, particularly child poverty. It is primarily concerned with the possible variations in child poverty rates among the 50 United States, as compared to the variations across the nation states of the European Union. The Luxembourg Income Study is used to make comparisons with variations by region in two other countries, namely Australia and Canada.

Several recent studies have documented the rising earnings and wage inequality and the widening inequality in the distribution of family income in the United States over the past 15 years. We examine the effect of government tax and transfer policies to offset some of these disequalizing changes, using a sample of six nations observed in two periods during the 1980s. We ask the following questions: in addition to changes in earned income inequality, how do other components of market income affect market pre-government income inequality? How does government tax and transfer policy affect the distribution? And finally, what were the trends in market driven inequality, government intervention, and disposable income inequality during the 1980s? The results of our exploration indicate that the U.S. redistribution system is decidedly weaker that that found in other nations.

In this paper we present a comparative analysis of earnings inequality during the 1980s among prime age men who headed households and worked year‐round, full‐time from five industrialized countries‐Canada, Sweden, Australia, West Germany, and the United States. The data were obtained from the Luxembourg Income Study (LIS) database, a multinational collection of microdata sets from various countries which have been assembled for the primary purpose of making cross‐national comparisons of economic and social well‐being. The results of the comparison indicated that during the mid‐1980s, the United States had the most unequal distribution of earnings and Sweden the least unequal. Between the early 1980s and mid‐1980s, however, the earnings distributions in all five countries showed evidence of becoming more unequal, especially in the United States, Canada, and Sweden.

The main aim of this paper has been to summarize the impact of noncash income–health and health education benefits, and imputed rent‐on living standards, income distribution and poverty in seven nations at the beginning of the 1980s using the Luxembourg Income Study database. Our results do not give rise to a pattern of national differences in poverty rates or income inequality which are markedly different from that which emerges from previous LIS research based on cash income alone. While these results may be sensitive to the techniques used to measure and value noncash benefits in this paper, it appears that noncash income reinforces the redistributive impact or conventional (cash) tax‐transfer mechanisms rather than acting to offset them in any major way.

The economic well-being of households is determined by their resources relative to their measurable economic needs. Economic resources include both cash and non-cash income. While after-tax cash income is the most widely employed measure of household economic well-being, it may exclude considerable amounts of resources received in a non-cash form. These include health care, education, housing, food and other subsidies from governments; production for own consumption by farmers, peasants and other individuals living mainly in rural areas and small towns; and in-kind transfers received from relatives, friends and others in the form of food, clothing and/or shelter. Moreover the distribution of these non-cash resources may vary systematically by population subgroup, thus affecting measures of relative economic well-being within and between households. They may also differ systematically by country. They almost certainly differ by regime, for example in the post-communist reforming socialist economies (RSEs) as compared with Western European and other Western nations.2