Exchange rate and wage policies in Central and Eastern Europe

After the eastern enlargement of the European Union (EU) and due to increasing labor market integration, wage determination in Central and Eastern Europe (CEE) has become a key issue in European economic policy making. In addition, a controversial discussion concerning the monetary integration of CEE countries into the EMU has emerged. Both issues have earned particular academic and political interest because Eastern and Western Europe are at different stages of economic development and volatile international capital flows seem to require either a higher degree of wage or exchange rate flexibility. Based on the Scandinavian model of wage adjustment by Lindbeck (1979), we analyze the role of exchange rates in the wage determination process of the Central and Eastern European countries to identify which exchange rate strategy contributes to faster wage convergence in Europe. Panel estimations suggest that workers in countries with fixed exchange rates are likely to benefit in the long run from higher wage increases.     

The Changed Welfare Paradigm: The Individualization of The Social

The first part of this paper offers a cumulative review of the changes in global objectives and operating principles and their global consequences, characteristic of the shift from the ideal type of the modern welfare state to the neo-liberal or post-modern paradigm. The paper then spells out some of the implications of this shift for social security in the "transition countries" of Central and Eastern Europe. The tendencies (from marketization to the spread of means-testing) are similar to those in the West; but they are much more marked and there is much less political and popular resistance to these changes. One of the crucial ingredients of the shift is the undermining of the age-old solidarity between generations, a trend also strongly recommended by the supranational agencies. The "catch", or the "paradox of democracy" is that, for all the lack of resistance, people do not seem to approve of the rapid withdrawal of the state and the loss of their existential securities.     

Poverty and deprivation among children in Eastern Europe and Central Asia

Although there is now a large body of literature on poverty in the countries of Eastern Europe and Central Asia, there remains a dearth of comparative analysis of child poverty and wellbeing. This article uses household survey microdata for the period 2001–2003 to compare absolute poverty, relative poverty, material deprivation and participation in schooling among children in five countries: Albania, Bulgaria, Moldova, Russia and Tajikistan. The analysis shows that low absolute levels of household consumption are associated with other deprivation indicators and with children's participation in schooling. The article also highlights the usefulness of relative poverty measures that effectively identify children at risk of exclusion in even the poorest countries in the region. The article concludes by arguing that household consumption is a good indicator of child poverty and deprivation in the region, and that relative poverty measures should be more widely used in monitoring global targets for poverty reduction.     

Welfare through Work: An Audit of Occupational Social Provision at the Turn of the New Century

Occupational welfare has been a relatively neglected area in both theoretical and empirical studies of the welfare state despite its importance to overall levels of social provision. Surprisingly, there has not yet been a comprehensive examination of British occupational social provision, as opposed to non‐wage benefits more generally or specific provision such as pensions, housing or childcare. This neglect can be explained both by the perception that occupational welfare plays a relatively insignificant role in contemporary welfare states and by a general lack of clarity regarding its definition and scope, factors which have added to the difficulties surrounding its conceptualization and measurement. Despite the lack of attention it has received, however, recent pressures have propelled the issue higher up the social policy agenda, increasing the need for a clearer conception of what constitutes occupational social provision and a more comprehensive assessment of its contemporary significance. This paper seeks to shed some light on to these areas by drawing on comparative and UK data in order to carry out an audit of occupational social provision.     

Social Security in a Rapidly Changing Environment: The Case of the Post-communist Transformation

Overcoming the economic crisis and implementing institutional change in Central and Eastern Europe and the former Soviet Union has been greatly facilitated by a pre-existing social security network—although adaptations to the new circumstances have been necessary. This paper offers a review of these adjustments and the various strategies that have been employed for mitigating losses in income and in social cohesion with the market reforms. The paper shows how countries first expanded, then curtailed their social programmes, and have started moving away from collective to individualized solutions, not only in the economic but also in the social field. Although this thrust promises many advantages, such as greater personal responsibility and system transparency, several population groups—typically those that fail to form a powerful interest group—risk being left behind by the reform process. The paper concludes that these experiences from the region offer valuable lessons for social programmes assisted by international exchanges that aim to counter the negative impacts of rapid economic and institutional change increasingly a worldwide phenomenon.     

Welfare Policies and the Construction of Welfare Relations in a Residual Welfare State: The Case of Hong Kong

Each welfare system has its own welfare relations for shaping and maintaining certain types of welfare practices and welfare ideologies. Welfare relations concern the distribution of welfare responsibilities among various social institutions, the public's welfare expectations and entitlements, and the status of welfare recipients. Welfare policies, which are a legal basis of the dominant class's philosophy as well as a mechanism for policing welfare recipients' use of benefits, play an important role in shaping and constructing the welfare relations of a country. This paper discusses how welfare policies construct the required welfare relations with regard to Hong Kong's social security system. It is argued that the persistence of Hong Kong's residual welfare model is partly based on the residual welfare relations which facilitate family-centred and market-oriented welfare practices.     

Alike but not alike: Welfare state and unemployment policies in Southern Europe. Italy and Portugal compared

Although Italy and Portugal are considered to be part of the same welfare state family – the Southern European one – analysis of a key component of the welfare state, namely, unemployment policies and regulations, reveals a different evaluation. A comparative analysis of a series of specific indicators of Italian and Portuguese unemployment regimes shows that they represent two different models. Portugal appears to be a more inclusive system, closer to continental or Northern European countries than it is to Italy, or at least representing a hybrid system that combines characteristics of continental European welfare states with characteristics that are more typical of Southern European welfare states. Italy, on the contrary, is much more clearly a Southern European welfare state.     

The Dutch and Danish Miracles Revisited: A Critical Discussion of Activation Policies in Two Small Welfare States

Denmark and the Netherlands are usually considered to belong to two different families of welfare states: the Scandinavian and the Continental model respectively. Yet, in both states active labour market policies, or activation, have increased during the 1990s and are currently prominent. Both in Denmark and in the Netherlands activation has been viewed as an important reason for the low unemployment rates which both states have experienced since the early to mid‐1990s, hence explaining the so‐called Dutch and Danish jobs miracles. The paper examines critically the activation measures taken in both countries and their alleged positive effect upon (un)employment. It further examines their effect on rights and obligations from a citizenship perspective. The paper concludes that in both cases the positive development of labour market performance cannot primarily be attributed to activation measures. Furthermore, activation has reduced the entitlements and increased the obligations affiliated with social citizenship.     

How to Design a "Liberal" Welfare State: A Comparison of Canada and the United States

My aim in this paper is to show how differences in the programmatic design of two otherwise "liberal" welfare regimes have generated substantially different patterns of welfare state retrenchment and distributive outcomes since the 1970s. Welfare regimes are distinguished by the principles and rules that regulate transactions between the three institutional nuclei from which individuals derive their "welfare" in modern capitalist societies—the state, the market, and the family. Liberal regimes are characterized by a preference for market solutions to welfare problems. While Canada and the United States both represent paradigmatic instances of the liberal regime type, there are long-standing differences in methods both of financing and distributing benefits. Differences in programme design led to substantially different retrenchment strategies from the end of the 1970s, which in turn produced dramatically different distributive outcomes: rising inequality and poverty rates in the United States compared to relative stability in the distribution of income among Canadian families.     

The Public's Changing Perceptions of the Condition of Social Welfare in Hong Kong: Lessons for Social Development

In the aftermath of the Asian financial crisis, the Hong Kong government introduced welfare reforms to ease the pressure from fiscal challenges and swelling welfare rolls; at the same time, to maintain its development credentials, it made an effort to adhere to its colonial tradition on the provision of welfare. The government adopted various strategies to garner popular support for promoting economic development as the primary goal and for promoting social harmony under the concept of ‘helping people to help themselves’. This article examines Hong Kong people's changing perceptions of the condition of social welfare in the past decade. Using a multidimensional developmental welfare approach and data from two opinion surveys conducted in 1997 and 2008, the study finds that Hong Kong people expressed a relatively high level of satisfaction about their own lives, but varying degrees of reservation about the problem of poverty, government provision of social welfare, and opportunities for social mobility. As a result of the sectorally unbalanced welfare reforms, which are biased against the disadvantaged, some of these perceptions have become more negative in recent years. Socially vulnerable people, especially the lower classes, are now more critical of the condition of social welfare, and such feelings seem to be intensifying. It is thus suggested that special attention to the issue of class should be paid in social development programmes to ensure social equality and social justice.     

Rural Movements in Europe: Scandinavia and the Accession States

This paper explores the national rural/village movements now established in some 16 European countries, with special focus on those in Scandinavia and Eastern Europe. The aim of the paper is to raise awareness by providing information on the significance of rural social movements, rather than to attempt a detailed analysis. Starting in the 1970s in some Scandinavian and Western European countries, as a local community response to rural decline, the village movements have built into major national forces, and have recently expanded into the EU accession states in Central and Eastern Europe. They were established to address issues of rural decline, agricultural change, migration, centralization and EU accession. They are now also organizing themselves at EU level, to provide a voice for rural communities in Europe. This is a notable example of a structured approach to mobilizing rural communities to become stronger agents of local development and to participate in rural policy‐making at local, regional, national and EU levels. The paper draws on information gained in a recently completed initial investigation of the national village movements in Estonia, Finland, Slovakia and Denmark, together with information from Sweden. The information is based on that gathered from a wide range of interviews and the minimal documentation available from the movements themselves. The experiences of the movements in enabling local structural development, capacity‐building, empowerment and action are documented, as is their work to develop strategic planning and advocacy. The paper identifies the motivating forces, structural and process models, activities and outcomes of the different movements. It takes account of the effects of differing national contexts, and identifies some key elements of experience and learning.     

Ageing and the politics of pension reforms in Central Europe,South‐Eastern Europe and the Baltic States

Cerami A. Ageing and the politics of pension reforms in Central Europe, South‐Eastern Europe and the Baltic States Int J Soc Welfare 2011: 20: 331–343 © 2010 The Author(s), Journal compilation © 2010 Blackwell Publishing Ltd and the International Journal of Social Welfare. This article investigates ageing and the politics of pension reforms in Central Europe, South‐Eastern Europe and the Baltic States. It emphasises the importance of historical legacies, presence of veto points, trade unions' power, electoral rules and country‐specific patterns of political competition, but it also highlights the central role in institutional change played by other concomitant factors, such as those associated with the communicative actions of national and international actors. The role played by power politics, class conflicts and strategic use of social policies is also emphasised. The main argument put forward in this article is that pressures for reforms in the pension systems have not only been the response of demographic, economic and financial pressures but have also been the result of a new consensus found on new economic ideas and discourses that saw in the privatisation of the economy a new modernisation paradigm.     

Foundations of the Workfare State – Reflections on the Political Transformation of the Welfare State in Britain

The British ‘welfare state’ has been transformed. ‘Welfare’ has been replaced by a new ‘workfare’ regime (the ‘Work Programme’) defined by tougher state regulatory practices for those receiving out‐of‐work benefits. US‐style mandatory community work programmes are being revived and expanded. This article, therefore, considers shifting public attitudes to work and welfare in Britain and changing attitudes to working‐age welfare and out‐of‐work benefits in particular. It also considers the extent to which recent transformations of the state may be explained by declines in traditional labourist politics and class‐based solidarity. Thus, we attempt to develop a richer understanding of changing public attitudes towards welfare and the punitive regulatory ‘workfare’ practices engaged by the modern state in the liberal market economy; reflecting on the nature of the relations between ideology, party policies, popular attitudes and their political impact.     

Targets and Taxes: Explaining the Welfare Orientations of the Australian Public

Australia's welfare model – targeted payments alongside low but progressive taxation – exemplifies the targeted approach, prioritizing the needs of poorer citizens within the constraints of low taxation. But does this approach match the welfare orientations of Australia's voters? Does the public hold other views about welfare, emerging out of competing interests in welfare debates? We consider results of two questions included in the Australian Survey of Social Attitudes 2005. The first question asks respondents about four welfare goals that outline competing welfare orientations: targeting poverty, expanding health and education, enforcing the welfare rules and reducing welfare. The second question asks about four taxation goals drawing on similar orientations as established for welfare: targeting tax cuts, taxing for welfare, enforcing tax rules and reducing overall tax. Asking about both enables us to tell whether voters approach tax and welfare ‘consistently’ and to see whether, in Australia's case, there is a preference for Australia's targeting model. We reach three conclusions: (1) voters hold diverse preferences about welfare and taxes, but the targeted model has a relatively strong voter base; (2) voters hold ‘pro‐welfare’ orientations, choosing poverty reduction and expanding public services over both paternalism and cutting welfare, and (3) multivariate analysis indicates a level of consistency in welfare and tax orientations among voters.     

Trust and health in Eastern Europe: Conceptions of a new society

Little attention has been paid to why trends and levels of mortality and morbidity differ in Eastern Europe and few studies have addressed people's own perceptions of their new political system – perceptions which per se may be important for social development. The aim of the present study was to analyse the extent to which trust and economic circumstances affect self‐rated health in Poland, Estonia and Russia and how much health differences between the countries can be explained by these factors. A better economy and higher trust were related to better individual health, while economic factors seemed most important for inter‐country differences. It is probable that both institutional factors and individual perceptions contribute to people's well‐being, but in terms of social policy, an improved welfare system may be the most effective way forward.     

Exploring Neglected Dimensions of Social Policy: The SDW, Fiscal Welfare and the Exemplar of Local Taxation in England

Titmuss's Social Division of Welfare (SDW) thesis is a vitally important but much neglected element of social policy analysis. This article seeks to explore the SDW, with a particular focus on fiscal welfare. Fiscal welfare has been described as forming a hidden welfare state, and while taxation is one of the main ways in which governments affect the lives of citizens, studies of welfare pay remarkably little attention to its impact. Fiscal welfare is examined by using, as an exemplar, local taxation in England, a subject that itself is neglected within social policy. Local taxation in England is of interest because it illustrates the impact of a system of taxation on different groups of citizens, and how this can operate to the benefit of rich over poor citizens. This is because the current system is highly regressive, meaning that those on low and middle incomes spend proportionately more of their income paying the tax than do those on high incomes. What is of further interest is how within the debate about reform of local taxation, concern with regressivity becomes obscured and ceases to be the focus of attention. We are thus provided with an example of how fiscal welfare remains a hidden issue. The article concludes by arguing that social policy analysis needs to move beyond the narrow confines of social welfare and develop a broader understanding of welfare, based on the SDW.     

前车之覆 后车之鉴——对苏东前社会主义国家改革失败原因与教训的再认识

苏东前社会主义国家的改革前后经历40余年,出现了三次浪潮,在取得巨大成就的同时却犯下了严重错误,最终走向失败.这主要是由于其实行了错误的改革路线,党内特权、腐败现象也导致了民心丧失,最终使改革失去了群众基础,同时也是西方敌对势力推行"和平演变"战略的结果.现有社会主义国家尤其是我们中国要吸取其教训,从改革的指导思想、策略原则、和谐环境构建等方面取得突破,确保改革顺利进行.     

Class, Attitudes and the Welfare State: Sweden in Comparative Perspective

One of the most important arenas for contemporary class politics is the welfare state. In this article, attitudes towards welfare policies among different classes in Sweden are compared with other Western countries and over time. In the first part of the article, attitudes towards state intervention among different classes are compared across four Western countries: Sweden, Germany, Britain and the USA. The data come from the 1996 survey on “The Role of Government” conducted within the International Social Survey Programme. In the second part of the article, more detailed national data sets are used in order to track developments within Sweden from the early 1980s until 2002. Attitudes towards welfare spending, financing of welfare policies and service delivery are used to track developments of class differences in attitudes over time. It is concluded (a) that class differences are particularly large in Sweden, and (b) that changes over time indicate stability in overall class differences, combined with changes in attitudes among non‐manual employees. The implications of the results for recent arguments about the restructuring of class relations and the impact of welfare policies on stratification are discussed.     

Second‐pillar pensions in Central and Eastern Europe: Payment constraints and exit options

During 1998–2007, a majority of Central and Eastern European (CEE) governments enacted laws obligating workers to save for retirement in privately managed individual accounts. The governments funded these accounts with a portion of public pension revenues, thus creating or increasing deficits in public systems. After the onset of the global financial and economic crisis (2008), most CEE governments reduced these funding diversions and scaled back the accounts. Now, a decade after the crisis, this article examines the benefits that the accounts are beginning to pay retiring workers. In general, these benefits are shown to be disadvantageous compared with public pensions. Some pay lump sums in lieu of regular monthly benefits, most fail to adjust pensions regularly for inflation, and some pay women less than men with equal account balances. In several countries, pensioners with individual accounts receive lower benefits than those without them. To enable retiring workers to avoid these disadvantages, several CEE governments have allowed them to refund their account balances and receive full public pensions. Yet while this strategy diffuses worker dissatisfaction, it also places strains on public pension finance. To assist second‐pillar account holders without weakening public pensions, governments should consider making private pension savings voluntary and financing these schemes independently of public pensions – i.e. by worker and employer contributions and, possibly, direct state support.     

Welfare State Developments in the Russian Federation: Oil-led Social Policy and 'The Russian Miracle'

This article investigates the main welfare state developments of the Russian Federation that have occurred since the fall of communism. It argues that the contemporary welfare expansion strictly depends on high oil and gas prices, and that this oil-led social policy makes the future of the 'Russian miracle' highly volatile. The main conclusion is that the Russian welfare state will be able to function properly and to ensure social integration and solidarity only under conditions of sustained oil-led growth. The article also identifies a variety of different, but equally important, endogenous, as well as exogenous, factors that have influenced the social policy developments in the Russian Federation since 1989. These correspond to the existence of few veto points present in the political arena, the lack of a well-structured system of interest representation, the presence of informality in the welfare state organization, but also to the presence of national economic vulnerabilities and/or strengths in the now open global economy, as well as to non-contingent decisions taken in strategic sectors of the state, such as those related to the energy or defence sectors.