The paper provides an overview ofhousehold welfare, labor markets, and social programs inAlbania, outside of its capital, in 1996. At the time,Albania was in a cross roads, from a period of phenomenalgrowth, to a series of economic crisis, though still rankingas the poorest country in the Central and Eastern EuropeRegion. The main findings suggest that the majority of thepoor are rural, self-employed in agriculture, a result ofAlbania's large rural population that is mainlyemployed in subsistence agriculture. These households alsohave the highest poverty incidence, followed by out of laborforce individuals, and the unemployed. Not surprising, thehighest poverty incidence is in the rural north, requiringsubsidized wheat, and cash transfers to survive difficultwinters. Interestingly, migration is a major coping strategyin Albania: households with no migrants, were poorer thanthose where a family member was working abroad. The studyraises concern about the education system, and safety nets,considering there are high drop out rates in basic, andsecondary education among the poor, and, education spendingis biased against the poor, except in basic education.Moreover, health outcomes are particularly worse among thepoor. The study notes that outside of pensions,Albania's social protection system appears moderatelywell targeted to the poor, however, high tax rates, andlimited wage base, makes a contribution based socialprotection system questionable.
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