Policy Brief - From Data to Action: an Evidence-Based Approach to Anti-Poverty in the EU

Executive Summary

Poverty is a multi-dimensional and evolving issue, much more complex than the mainstream discourse would paint it to be. It isn’t just about mere income distribution, which many typically associate with the concept. Poverty is at play wherever inequalities put someone at a systemic disadvantage: as inequalities discriminate among employees, in-work poverty can affect full-time employees; as inequalities are reflected in school participation and learning outcomes, educational poverty often accompanies children from fragile socio-economic backgrounds. Investing in effective tools and policies that can identify those at the margins and provide effective solutions to their needs is more crucial than ever, as inequalities are rising on several dimensions. This affects the European Union as well, particularly given the impacts of COVID-19, wars, and economic crises on everyday life of its citizens.

The fight against poverty is not a new one. It has been a feature of national policies and academic research for many decades. However, the ways in which a State fights against poverty have changed over time, continuously evolving to approach new challenges through the adoption of new tools and policies. For instance, a notable turning point came with the 2019 Nobel Prize in Economics, awarded for pioneering research in understanding and fighting poverty through rigorous, data-driven innovative approaches. Despite this progress, governments and institutions often need to catch up and enhance their understanding of this increasingly complex and intertwined social issue, fully leveraging the power of data to formulate effective policies having a sizeable and measurable impact.

In this policy brief, we focus on the European context, discussing how institutions have tackled poverty and inequalities in such unprecedented times. We will review some of the ways in which the previous European Commission has shaped anti-poverty policies, emphasizing the need for a rigorous approach rooted in data, impact evaluation and evidence-based policymaking. Although such principles are neither innovative nor unprecedented in the EU’s fight against poverty, we show that for most policies thus far, they have either not been correctly implemented or attempted at all. We suggest that the new Commission will have to plan specific investments for collecting reliable data on key poverty dimensions and for gathering rigorous impact evaluations. At the same time, it will have to work with national governments to plan data-driven policymaking and to ensure monitoring along the implementation.

For the purpose of this policy brief, we will examine two case studies to show the crucial role of data in effective policymaking against poverty: homelessness and education. The former, illustrating how data can reveal hidden social phenomena that would otherwise remain invisible; the latter showing how data can measure the impact of policies, identify the most effective and efficient solutions, and establish a replicable policy framework for various key dimensions. We will show that homelessness still lacks the policy investments to construct a coherent EU-wide data framework, making it difficult to understand the extent of the phenomenon in a uniform and consistent manner; on the other hand, education has been a field at the forefront of policy for a long time – yet for too long the focus has been on quantity rather than quality. A more rigorous approach founded on impact evaluation can shape policies ensuring better – not just more – educational and learning outcomes and thus opportunities for younger Europeans.

The rest of the paper is structured as follows: in the next section we introduce the context of homelessness and educational poverty in the EU, both within member states and across them. In the following section, we briefly review the EU’s previous efforts in tackling these two issues and show their shortcomings. Then we focus on how to establish evidence based and data-driven approaches to policymaking, also offering some best practices as concrete examples of how such a structured approach could greatly improve the way EU institutions tackle poverty. Finally, the last section concludes and summarizes our prescription for a more effective fight against poverty.

IEP@BU does not express opinions of its own. The opinions expressed in this publication are those of the authors. Any errors or omissions are the responsibility of the authors.

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