Inequality and Poverty Reduction and the Limits of Social Protection Systems: The Case of Argentina during the Stage of Economic Expansion 2003-2014

Production of INCASI Project H2020-MSCA-RISE-2015 GA 691004Latin America experienced a rapid decrease of poverty and inequality during the first years of the new millennium that eventually decelerated in recent years. In Argentina, a key aspect of poverty and inequality reduction seemed to be simultaneous changes in labour markets and in social protection systems, particularly in social assistance. However, these elements have rarely been considered together at household level in Argentina and in Latin America, even though labour markets and social policies are the core of the welfare regime. Thus, the main aim of the article is to examine how these spheres were articulated among different groups of households and to assess their welfare outcomes. The article draws upon a quantitative methodology using official data and micro-data of the Permanent Household Survey from Argentina for 2003-2014. The main hypothesis is that the expansion of the social protection system coexisted with a persistent labour informality, which maintained the heterogeneity of the welfare regime mitigating the power of social protection to reduce poverty and inequality. Moreover, our study shows the limits in developing countries for sustainable reduction of poverty and for social inclusion in absence of deep changes in labour markets, even in a relatively favourable macroeconomic context for more equitable wealth distributio