VOLARE · Navigating volatility in different welfare state contexts

Income targeting has permeated social policy design in European welfare states, in order to boost their efficiency and effectiveness. Yet real-life examples of integrated income-targeted schemes highlight the shortcomings of an overly technocratic view. Social policy research needs to analyse how policy design interacts with the month-to-month income variability experienced by households, and the strategies they develop to cope with and navigate this volatility.VOLARE disentangles the relationship between fluctuating incomes, household navigating strategies and social policy design in different institutional contexts. VOLARE’s theoretical framework argues that a) households employ both formal and constrained strategies in the face of volatile incomes, that can be focused on short-term juggling of incomes, or oriented towards longer-term objectives; b) the welfare state context and households’ preferences for stability influence the adopted strategies, but c) with their strategies households also actively navigate the eligibility and entitlement criteria determining the accessibility, timeliness and effectiveness of social policy responses. VOLARE assesses the implications of this interaction for effective social policy design.The framework is scrutinized empirically within an innovative mixed-methods design that links consecutive quantitative monthly incomes collected among over 240 low to middle-income families in four European countries, with in-depth interviews on the strategies selected households develop to navigate volatile incomes. These findings are confronted with nationally representative month-to-month volatility estimates and welfare state responses. A survey experiment adds further substance as to how households value stability over income, given their access to formal or constrained navigating strategies.In doing so, VOLARE forces a major breakthrough in the research on income volatility, social policy effectiveness and household strategies.