In 1989, Albania's rigid political and socioeconomic structure shattered beyond repair. Turbulence soon invaded every domain of life. As the state imploded, so did the state-run economy. This review explores ongoing consequences of this difficult transformation that took place since 1989 and of policy initiatives to mitigate or ameliorate its effects. Albania has been much studied
the review addresses important information gaps. It establishes, from the representative 2002 Living Standards Measurement Survey (LSMS), which kinds of families receive public income transfers and private income flows in what amounts and from what sources. It estimates the impact that these public and private income flows have in mitigating pre-transfer and post-transfer poverty among households. It does this by type of family and source of income flow, for all Albanian households and for various subsets of them. This review analyzes the relative importance of pensions and social assistance in alleviating poverty among rural households with aged members. This review also documents and links data on expenditures under social programs with data on program beneficiaries for recent years and it identifies current tradeoffs among the multiple objectives of social safety net policies, including those relating to coverage, adequacy, work incentives, equity, and effective government spending. Finally, it suggests options for future development of social safety net policies, including ways to strengthen overall policy linkages and programmatic coordination among social programs.