To Reduce Poverty, Expand the Welfare State

The policy solutions to poverty are simple: redistribute capital ownership and expand the welfare state.

Some people think poverty is what results when employers exploit workers on the bottom of the labor market. Other people think poverty is what results when individuals behave in dysfunctional ways. These two dominant theories then generate a variety of policy ideas, including increasing educational attainment and work incentives to improve labor market outcomes, changing employment rules so as to increase pay for lower-level workers, and instructing people to change the way they engage in family formation, among other things.

When I first got interested in practical poverty policy nearly two decades ago, I went into it with these two theories in mind, assuming that what I was likely t