How does economic globalisation affect the welfare state? Focusing on the mediating effect of welfare regimes

In recent years the impact of globalisation on the welfare state has become a major issue in comparative policy studies. Some empirical studies demonstrate a negative relationship between globalisation and the welfare state, while others show adverse findings or a non-significant relationship. The impact of globalisation, however, can be neither uniform nor unidirectional because of the differences in the political economies of individual welfare states. Welfare regimes reflect qualitative differences in arrangements of welfare institutions and the associated enduring configuration of the welfare nexus, suggesting that welfare regimes may influence the impact of globalisation on the welfare state. We scrutinise the relationship between globalisation and the welfare state by sampling 18 affluent countries from 1980 to 2001 and concentrating on the mediating effect of three welfare regime types. Our study provides a comprehensive examination of the relationship between globalisation and the welfare state using a state-of-the-art analytical technique – the mixed-effect model. Findings suggest that welfare regimes respond differently to the impact of globalisation and therefore mediate the relationship between globalisation and the welfare state. Globalisation negatively affects the welfare state in a social democratic regime, while it marginally affects the welfare state in liberal and conservative regimes.     

The welfare state and globalisation: down and out or too tough to die?

Politicians as well as researchers frequently claim that globalisation – and in particular its economic dimension – poses a threat to the welfare state. This article examines whether such a claim is justified by the empirical studies that investigate the relationship between economic openness and the welfare state. Based on the literature, two contrasting hypotheses are distinguished: the first states that economic openness does threaten the welfare state and the second argues that this is not the case. The empirical studies are systematically reviewed in this article: the analysis shows that the second hypothesis is supported most often and it is therefore concluded that economic openness does not threaten the welfare state.     

Welfare municipalities: economic resources or party politics? Norwegian local government social programs of the 1920s

This article analyses the introduction of Norwegian local government social security programs for the elderly, disabled persons, widows and single mothers in the 1920s. The role of local government as an agent and initiator of welfare state development has been for the most part neglected within the welfare state literature. Indeed, the first social security programs in Norway were introduced by local governments, affecting nearly half of the population. Even if these programs were not very generous compared with the social security programs of our time, many of them were equal to, or even more generous than, the national pension scheme introduced in 1936. This article examines what distinguished the social security municipalities from those that did not implement such programs, and the variation in generosity profiles. The conclusion is that the main determinant regarding the implementation and generosity of the local social security programs is the political strength of the two Norwegian socialist parties at the time – the Social democratic party and the Labour party – both being too impatient to wait for a national social security plan, and both being willing to mobilise economic resources through taxation and borrowing.     

Economic openness and welfare state attitudes: A multilevel study across 67 countries

This article extends previous studies investigating economic globalisation and the welfare state by examining individual attitudes, ranging from a preference for individual responsibility (economic individualism) to public demand for government intervention (social equality), across a large number of countries. It formulates different hypotheses about the direct and moderating effects of economic openness on these attitudes. The multilevel analysis, investigating data from 99,663 citizens of 67 countries, leads to the following two conclusions. First, economic openness is associated with a stronger preference for economic individualism and less demand for government intervention. Second, groups benefiting from globalisation and right‐wing voters have a stronger preference for economic individualism if the economic openness of their country is higher. Key Practitioner Message: ● The results show that some vulnerable groups demand more social protection in economically more open countries.     

Levels or worlds of welfare? Assessing social rights and social stratification in Northern and Southern countries

Since Esping‐Andersen's Three Worlds, it has become a truism of welfare state research that welfare states do not vary linearly along a single dimension but have to be conceptualized as multidimensional phenomena that cluster into types caused by the political economy of class coalitions. However, when moving beyond the 18 original countries of Esping‐Andersen's analysis, the situation is less clear. Although additional worlds have been identified in the Global North and the Global South, these are usually not conceptualized along the same dimensions as the original three worlds and are rarely empirically compared with them. This paper tackles these omissions by explicitly comparing Northern and Southern countries within Esping‐Andersen's framework. It poses the question whether the central insight of welfare state research, namely, that there are not just gradual differences between welfare states, but different types with qualitative differences, expands beyond classic welfare states. Based on newly generated data on social rights and social stratification, we employ cluster analysis with 45 Northern and Southern countries. This analysis produces mixed results. We do find different types of welfare states with qualitative differences, but these do not fully correspond to Esping‐Andersen's Three Worlds. Moreover, our findings also point to a conceptual issue in welfare regime research: regimes are not just defined and measured in terms of different logics of welfare provision but also take into account degrees of welfare stateism. We argue that this issue is poised to become ever more pressing with the geographical expansion of welfare state research.     

Low Public Expenditures on Social Welfare: Do East Asian Countries have a Secret?

This paper explores the sources of low public expenditures on social welfare in Japan, Korea, Taiwan, Hong Kong and Singapore. Six factors are analysed based on aggregate data: the public/private mix of welfare programmes, the age structure, the maturity of old-age pension schemes, the population coverage of social security, the relative generosity of social security and the role of enterprises and families as alternative providers of welfare. The evidence allows putting some conventional statements about the virtues of East Asian welfare states into questions. Public expenditures on welfare are bound to rise a lot in Japan, Korea and Taiwan, while the level of protection in Hong Kong and Singapore is well below the standards of Western countries.     

Analysing the Welfare State in Poland, the Czech Republic, Hungary and Slovenia: An Ideal-Typical Perspective

This article applies ideal-typical welfare state theory in analysing the recent transition and the current position of welfare state systems in Eastern Central Europe, taking the cases of Poland, the Czech Republic, Hungary and Slovenia. The article argues that Eastern Central European welfare state systems have returned to their historical and cultural roots of welfare state formation and development, to the time before the onset of state socialism in Soviet times. First, social security policies and social and labour laws were established when the vast bulk of Eastern Central European countries were member states of the Austro-Hungarian Empire, sharing the same political economy, legal system and culture. Over the last 20 years, the socialist system of employment-based social services and benefits has been replaced with Bismarckian-type social security policy and systems. While there are major alterations here and there – in ideal-typical perspective – the four countries under scrutiny share all the major traits of Continental European (Christian Democratic) welfare regimes .     

Institutions and the gender wage gap: How production and welfare regime moderates the effect of family policy

The aim of this study was to determine whether the effects of work and family reconciliation policy on the gender wage gap are moderated by institutional contexts of production and welfare regime. Using time‐series analysis for 13 countries from 1981 to 2015, the study revealed a strong association between childcare and a lower gender wage gap in the Coordinated Market Economies (CMEs)/social democratic welfare states but not in Liberal Market Economies (LMEs)/liberal welfare states. The study also found that the impact of leave generosity on the gender wage gap in CMEs/social democratic welfare states is less salient than in CMEs/continental welfare states. This study highlights the extent to which family policy affects the gender wage gap hinges on how each country organises its market coordination and welfare institutions and pushes the current literature forward to a question of ‘what kinds of’ family policy matters in ‘which’ production and welfare regimes.     

Public income transfers and wealth accumulation at the bottom: Within and between country differences in Canada and the United States

Both Canada and the United States are considered liberal welfare states, yet exhibit notable differences in income poverty attributed to social policy. While a more generous welfare system lifts many above income poverty, models of household financial behaviour suggest that more income from the state should displace private savings via a substitution effect. Using nationally representative wealth surveys from Canada and the US from 1998/1999 to 2016 we extend knowledge on the relationship between the welfare state and private wealth accumulation. Specifically, we study household asset poverty defined as financial asset levels that fall below three-month adjusted income poverty threshold. Asset poverty rates varied over time in the two countries and were higher in the less generous US welfare state. Further, income transfer share was positively related to asset poverty in Canada but not in the US. Counterfactual estimates offered evidence of the substitution effect in Canada, where higher levels of transfers may crowd out private asset accumulation. Results invite further consideration of the concept of asset poverty and its relationship to welfare state characteristics.     

Productive welfare: Korea's third way?

How can the various pressures of economic globalisation and changes in the established welfare systems of the industrialised nations inform the development of the Korean welfare state? As the twenty‐first century dawns, Korea is confronted with a serious dilemma: How to adapt to globalisation and survive under worldwide competition and at the same time construct an effective egalitarian welfare state? The objective of this paper is to explore the future directions for the Korean social welfare system as it adjusts to economic globalisation. As it seeks a course between the social democratic welfare state model and the rising tide of the neo‐liberal welfare state, we pose the question: Is there a ‘third way’ for Korea? In trying to discern where the Korean welfare state is headed, it may be helpful to understand where it has come from and how it compares with the established welfare states in the industrialised nations.     

Attitudes towards the welfare state have several dimensions

The dimensions and structures of opinions on the welfare state are not well known. This study distinguishes five dimensions based on previous literature: responsibility for welfare, financing of the welfare state, the use of benefits, the adequacy of the welfare state benefits and the effects of the welfare state. One or more attitude indicators are formed for each dimension by means of factor analysis of empirical material. Examination of the correlations between the dimensions and attitudes yields two opinion structures. A supportive attitude structure is founded on the concept that public authorities have responsibility for welfare services, a positive attitude towards public financing of welfare services, and on the concepts that the amount and quality of services and the level of income transfers is not adequate. The critical cluster of attitudes is formed by the reliance on private responsibility, negative attitude towards public financing and on the concepts that benefits are overused and that the welfare state makes its clients passive. Finally, the variation in attitudes among the population of Finland are studied by means of regression analysis. Social class, age and political party sympathies are the most important explanatory factors for a range of attitudes.     

One hundred years of money,welfare and death: mortality,economic growth and the development of the welfare state in 17 OECD countries 1900–2000

Kangas O. One hundred years of money, welfare and death: mortality, economic growth and the development of the welfare state in 17 OECD countries 1900–2000 Int J Soc Welfare 2010: ??: ??–??© 2010 The Author(s), Journal compilation © 2010 Blackwell Publishing Ltd and International Journal of Social Welfare. The article focuses on the role played by the welfare state vis‐à‐vis GDP in the increase of life expectancy in 17 OECD countries 1900–2000. The article shows that money matters, war kills and the welfare state is good for health. There is a curvilinear relationship between prosperity and longevity: after a certain level, the marginal utility of an extra dollar levels off. In the longer run, growth is a necessary but not sufficient condition. The welfare state plays its role, too. Bigger is better, be it with regard to social spending or the generosity or coverage of social protection. For the life expectancy of a population to increase, it is better to have broader coverage or universal access to care than to have more generous benefits, which are channelled to a limited circle of citizens. It is better to give adequately to all than lavishly to too few.     

Hybridization instead of Clustering: Transformation Processes of Welfare Policies in Central and Eastern Europe

Welfare state theories tend to use concepts of clustering for defining the affiliation of national social security systems to overarching worlds of welfare. A closer look at the transformation processes of welfare policies in Central and Eastern Europe shows a great variability among those countries in approximating their welfare states to Western European standards. In the design of their pension systems, their health care provision and their unemployment protection, Central and Eastern European Countries (CEEC) follow different reform paths. Welfare clusters in Western Europe are used as reference models, but no single example applies to all sectors of social security. Thus, a generalizing picture of welfare provision cannot be drawn for Central and Eastern Europe. Instead of constituting a new individual type of welfare arrangement, a hybridization process is observable.     

Giving money to strangers: European welfare states and social trust

Jensen C, Svendsen GT. Giving money to strangers: European welfare states and social trust Int J Soc Welfare 2011: 20: 3–9 © 2009 The Author, Journal compilation © 2009 Blackwell Publishing Ltd and the International Journal of Social Welfare. Why would you give money to strangers? That is the fundamental question posed by a new body of research into the relationship between social trust and willingness to accept high taxes and extensive welfare states. The literature argues that generalised trust causes and upholds universal welfare state institutions, an entirely plausible explanation of the Scandinavian social democratic welfare states. However, it cannot explain the presence of very large welfare states in Continental Europe, where the level of generalised trust is much lower than in Scandinavia. The article adds to the existing literature by arguing that the ‘bumblebee’ of conservative welfare states is characterised by particularistic trust and familiaristic welfare institutions, which are functional equivalents to the mechanisms found in Scandinavia. Future research into the trust–welfare state relationship should therefore focus on the trust profile of a country to understand how the welfare state provides its citizens with benefits.     

Incomes after Job‐loss in the United States: From Programme Rules to Panel Data

Welfare state studies are usually motivated by one or both of two concerns: programme effects on the incidence of poverty, and the possibility of perverse incentive effects. Most research has been comparative, using cross‐national indicators from the Organisation for Economic Co‐operation and Development and other international organizations. That research often contrasts the generosity of programmes in a number of European countries and the lack of it in the USA. Focusing on income transfers after job‐loss, in this article we critically examine the comparative evidence on US welfare state generosity and then use the Panel Study of Income Dynamics (PSID) to estimate what happens to job‐losers' incomes. The comparative analysis suggests conclusions more nuanced than found in much of the literature. The PSID analysis shows how the income effects of job‐loss vary across job‐losers and suggests that the role of unemployment compensation programmes in supporting incomes may be overstated.     

Government for the people: the substantive elements of democracy

The most widely used understandings of the concept of democracy – normative, procedural and institutional – focus on its methods and approaches. This article argues that democracy needs also to be understood in terms of its substantive implications. Democratic rights include not only the civil and political rights associated with liberal democracy, but also the economic and social rights promoted in industrially developed countries. Liberal principles promote democracy and economic development. Social rights have developed, not just through state action, but through the independent establishment of solidarities facilitated by the exercise of democratic rights. Every established democracy has a system of social welfare provision. This is not coincidental. Democracy, economic development and social protection are intimately linked.     

Retrenching or renovating the Australian welfare state: the paradox of the Howard government's neo-liberalism

Most conventional studies of the former Australian Liberal–National Coalition government refer to its neo-liberal ideological agenda: its concern to reduce government interference with free market outcomes by restricting access to social security payments. That analysis suggests a substantial retrenchment of the Australian welfare state based on redirecting responsibility for the disadvantaged from government to corporations, private individuals and families. Yet there is increasing evidence from reliable sources that the government has not reduced social expenditure, and that increasing resources have been directed, particularly via the family payments system, towards some disadvantaged groups such as low-income families and the aged. Utilising the theory of the US political scientist Paul Pierson, this article explores the joint paradox of Australian neo-liberalism: the punitive treatment of some disadvantaged groups such as the disabled and lone parents versus the generosity towards other groups and, more generally, the growth rather than decline in social expenditure. The author asks what this paradox tells us about the likely future of the welfare state in Australia and elsewhere.     

Globalization, the Welfare State and Young People Leaving State Out-of-Home Care

Some theories of globalization argue that it is producing a uniform reduction in social spending, while others claim that global influences are mediated by specific national factors. This article argues that the emergence of support for young people leaving state out-of-home care in almost all developed countries provides further evidence for the mediation thesis. Using Australia as a case study, attention is drawn to the commonality of poor outcomes for many care leavers, the different legislative and policy responses to these needs in a range of welfare states, and the role played by local and global researchers and policy advocates in bringing these needs to public and political attention.     

Economic Policy and Social Policy: Policy-linkages in an Era of Globalisation

This article argues that changes in the role of the state in economic affairs will affect the process of social policy. Growing economic integration caused by globalisation now places a greater constraint upon the discretion of the nation state, bringing about a transformation into a more competitive state. States are increasingly having to compete against each other in order to promote competitiveness and attract foreign direct investment (FDI) from international capital markets. This competition influences in turn the social policy formation requiring the redesigning of social policy. Thus, welfare states may need to reform their social policy towards a "business-friendly social policy". The analysis of social policy inputs and outputs presented here suggests that there are common trends in most welfare states towards: a market-conforming policy on business taxation, a reduction of the share of employer's contributions in social protection revenues, more limited income security programmes, an increased allocation of resources for active labour market programmes and less state intervention in the labour market. All these reforming trends in social policy can be understood as a response of welfare states to the evolving needs of business caused by structural change, notably globalisation.     

Confusion behind the dikes

Twenty years ago Dutch society was hit by a serious rise of unemployment that put the Dutch welfare state to the test: Should the welfare state be able to preserve full employment and prevent unemployment from becoming high and chronic as in the 1930s? And should the welfare state be able to prevent mass poverty as in the 1930s? The answers are well known. The ‘Dutch welfare state has not been able to forestall persistent high unemployment and, in fact, has more or less produced a dual society (Zweidrit-telgesellschaft, sociéte à deux vitesses), although without producing mass poverty. This article goes into three issues related to these developments. A bird's-eye view is presented of the unemployment trajectory of the 1970s, 1980s and the first half of the 1990s. The position of the Netherlands relative to other countries in Europe is unfolded. Some issues concerning the effects of chronic unemployment on the functioning of the Dutch political economy are presented.