Abstract
This paper provides new evidence about the income dynamics among families with children in Norway receiving social assistance benefits. The data includes all Norwegian families receiving social assistance benefits for the first time in 1995. The income development of these families is followed until the end of 1999. In order to take advantage of the longitudinal character of the data, multivariate panel data models are applied. The analytical framework is elaborated from two theoretical approaches, where hypotheses drawn from a dependency framework are tested alongside hypotheses developed from a life-course perspective. The latter is of particular relevance for the families under scrutiny. The results show that, far from being permanently marginalised from the labour market, most families respond positively to upturning business cycles, and work activity seems to be an important factor in increasing family income. Certain groups are worse-off economically than others: in particular, families going through life-phase changes, both expected and unexpected, are likely to experience longer periods of low income. Hence, the parents' transition from adolescence to adulthood and entry into the labour market seems to be a critical phase for families. Further, single parenting seems to influence family income negatively. Families with backgrounds from developing countries have a substantially lower income than native Norwegians and western immigrants; however, the former do not seem to have a stronger inclination towards benefit dependency than native Norwegians.
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