ABSTRACT
This chapter aims to fill in the lack of knowledge on the distributional income changes following from the shift from means-tested benefits to a more universal system. It discusses changes in income inequality in order to capture income effects for the entire income distribution. The chapter systematically evaluates linkages of family and social assistance benefits in Lithuania. In July 2004 the Law on Allowances to Children came into force in Lithuania. The chapter utilizes a microsimulation method for the evaluation of public policy effectiveness in Lithuania. Family policy includes direct cash measures that are specifically targeted at families with children. The chapter also utilizes a static microsimulation approach in order to determine each household's entitlement to family policy measures before and after the reform. It analyses direct and indirect distributional impacts of the reform using a range of standard inequality and poverty measures.
