A stress test for welfare state

This project tests how well a Nordic welfare state, Finland, protects employee households against unemployment, price shock, and interest rate shock. The microsimulation exercise provides information on a) if employee households are sufficiently insured and b) if employee households have too large housing loans.

The project also compares absolute poverty measures, based on household reference budgets, to relative poverty measures. The relative poverty rate is the at-risk-of-poverty rate with a threshold of 60% of equalized median income. In addition, the project analyses the financial distress of households.