Bringing Indonesia into the global welfare regime debate: A literature review and future research agenda

Studies on welfare state regimes have been dominated by consideration of rich OECD/European and increasingly East Asian countries/territories, leaving South Asian cases such as Indonesia underexplored. The few existing studies that have explicitly tried to conceptualize the Indonesian welfare regime have resulted in little consensus. To address the resulting lack of clarity, this article reviews scholarly articles relevant to bringing Indonesia into the global welfare regime debate, specifically encapsulating how the country has been classified compared with its East Asia counterparts. Accordingly, we find that existing studies have mainly concentrated on the Indonesian health care and social protection expansion, which has led authors to conclude that this evolution demonstrates Indonesia's transition away from welfare productivism. By contrast, we argue that Indonesia's productivist characteristics have largely prevailed while informal networks, clientelism, strong families, and the limited effectiveness of the civil society movement created a specific social politics in Indonesia. We thus conclude that the causal mechanisms typically attributed to welfare development in more developed welfare geographies, including East Asia, cannot fully explain the evident institutional formation in the Indonesian case. The future research agenda for studying the welfare regimes in Indonesia and other Southeast Asian countries is discussed.     

The economic consequences of the welfare state

What are the economic and employment consequences of larger social insurance programmes? Are larger welfare states diverting resources from economic activity and distorting the investment decisions of firms? I examine theoretical and empirical research on the economic consequences of the welfare state. This review shows that the predictions of a negative relationship between higher levels of social protection and growth have not been borne out in the data. Both insurance programmes and other policies that increase investment in human capital or the overall productivity of workers generate important economic externalities that outweigh the potentially distortionary effects of higher taxes. Empirical studies also fail to uncover a consistent negative relationship between larger welfare states and the level of employment. The employment consequences of the welfare state are mediated by existing institutions and policies—such as the level of centralization of the wage bargaining system—which affect the redistribution of the costs of higher taxes among workers and firms. As a result, the employment consequences of larger welfare states are non-linear.     

Social Policy and Development in Latin America: The Long View

In the new development strategy currently shaping Latin America, alternative social policy models have emerged. This article argues that far from being rival alternatives, each of these models considers the wide differences among countries. The region is emerging from a century of transformation – from a traditional agrarian economy to an urban industrial one – in which countries have taken diverse historical paths. Some have almost completed this transformation, others are taking early steps, and the vast majority are living through it. State‐led transition has followed two successive development strategies. From the 1920s up to the 1980s, state developmentalism has mostly successfully assumed the twin challenges of economic and social progress. In the last two decades of the century, Latin American states adopted the policies of the Washington Consensus, which emphasized the importance of business in the framework of globalization and benefited the affluent few. However, an unambiguous shift in direction has been taking place in Latin America since the 1997 economic crisis. This article suggests that a new developmental welfare state model seems to be in the making. How will it evolve over the wider space of an increasingly integrated Latin America?     

The Pro‐Elderly Bias of Social Policies in Israel: A Historical‐Institutional Account

Accelerated population ageing and high voting turnout rates among elderly voters in recent decades have led many social scientists to predict increasing pro‐elderly biases in the social policies of mature welfare states. This article investigates and empirically estimates the evolving age orientation of social policies in Israel, which is a comparatively young society that has nevertheless aged significantly since independence in 1948. We present a historical and qualitative overview of the development of policy efforts towards different age groups and develop an Elderly/Non‐elderly Spending Ratio at four points in time between 1975 and 2005. We argue that in its first five decades, the Israeli welfare state uniquely combined a broadly universalistic and citizenship‐based outlook with a number of significant particularistic spending biases towards specific subgroups. But from the second half of the 1990s onwards, the pro‐elderly policy bias of the Israeli welfare state has strongly increased. These findings support Lynch's thesis for 21 OECD countries, which posits that a shift from a universal to a more occupationally based institutional model of welfare will result in a higher pro‐elderly bias of social spending.     

Latin America: a new developmental welfare state model in the making?1

Latin America is emerging from a century of transformation – from a traditional agrarian to an urban industrial economy – where countries have taken diverse historical paths. Some have almost completed this transformation, others are taking early steps, and most are living through it. State‐led transition has followed two successive development strategies. From the 1920s to the 1980s, state developmentalism, for the most part, successfully assumed the twin challenges of economic and social progress. In the final decades of the century, Latin American states adopted the policies of the Washington consensus, which emphasized the importance of business in the framework of globalization, benefiting the affluent few. However, an unambiguous shift in direction has been taking place in Latin America since the 1997 economic crisis. This article suggests that a new developmental welfare state model is in the making. How will it evolve over the wider space of an increasingly integrated Latin America?     

The Emperor's new clothes: South Africa's attempted transition to developmental social welfare and social work

This article critically interrogates the depth and quality of change of post‐apartheid welfare policy and social work practice towards a social development paradigm against the background of inequality and poverty in South Africa. It asks several questions: what kind of welfare system has the current welfare dispensation created? How far has it moved from a residual, ameliorative system to an institutional developmental system, in keeping with the developmental welfare paradigm? To what extent can residual provisions be transformed into developmental processes? What conditions are necessary for this to happen? The answers to questions such as these provide the basis for assessing South Africa's new developmental processes. The article highlights the fundamental contradictions in social development policy imperatives, which call for a marriage of economic and social considerations, and the internal contradictions across and within various welfare policies. Further, it argues that the government does not have the political will to bear the costs of the substantive change that the move towards developmental social work requires, choosing instead limited, individually targeted and ameliorative measures, such as increased social security spending. Thus, it suggests that ideological critique, consciousness raising and participation in public policy debates remain crucial for those who seek long‐term solutions to inequality and poverty in South Africa.     

The United States: welfare, work and development

It has long been claimed that social welfare programmes harm economic development. These programmes, it is alleged, depress work incentives, divert scarce investment resources to 'unproductive' social services and create a large underclass of dependent individuals. Welfare reform in the United States intends to reverse these allegedly negative economic effects by requiring welfare clients to work. It also hopes to reduce poverty. This article examines these claims. It discusses the welfare reform programme and concludes that its impact on both economic development and poverty has been minimal. Policies that transcend the current obsession with work, promote sustained economic development and invest in human capabilities are more likely to succeed.     

THE WAGE EARNERS' WELFARE STATE REVISITED: REFURBISHING THE ESTABLISHED MODEL OF AUSTRALIAN SOCIAL PROTECTION, 1983–93

This article sets out to give an overview of the most significant policy changes and developments influencing the development of social protection in Australia in the past decade. Rather than focussing on an assessment of gains and losses within the narrow confines of the state welfare system, it looks at what has happened to the broad configuration of policies which have come to constitute Australia's highly distinctive wage earners' welfare state. Overall, the conclusion is that the institutional forms and normative goals of the wage earner's welfare state have proved far more resilient and adaptable than critics have assumed likely, with targeting, award-based superannuation and women's welfare singled out as the most interesting areas in which Labor has contributed to the refurbishing of the established model.     

Asset opportunity for the poor: an asset-based policy agenda towards inclusive growth in China

The concept of inclusive growth recently embraced by the Chinese government marks a new way of thinking about social policy and development. The primary goal of inclusive growth is to ensure that all people, especially the poorest, have an equal opportunity to participate in, and benefit from, the country's economic growth. In accordance with the new orientation of development strategies, there has been a paradigm shift in social policy from conventional income maintenance to promotion of the poor's asset accumulation and long-term development. Given China's striking social and economic inequalities, this article argues that an asset-based social policy is a key strategy in the strengthening of inclusive growth. The article highlights several areas of the welfare system where asset-based policies could be developed or expanded.     

Decentralization of decision making: the case of payment policies for children's daycare

To bring about equality, the Nordic welfare states have provided a broad range of services with as homogenous eligibility criteria as possible. This homogeneity of social benefits has been obtained by centralized decision making and a high degree of statutory regulation. Recent trends in all welfare states veer towards greater local independence and decentralization. This article examines how the decentralization of decision making in Finland has affected the realization of basic welfare state principles. The specific aspect from which the topic is examined are user fee policies for children's daycare. The analysis gives a rather inconsistent picture of possible explanations for the differences between daycare payment policies. Municipal decision making is influenced by economic rather than political or structural factors. However, logical economic explanations are found only in large municipalities. This study highlights that decentralization of decision making has put families in very different economic positions in different municipalities - municipal traps are emerging. The relationship between welfare services and income redistribution has become ever more complicated as decision-making powers have been localized. A family may, for example, be paying the highest daycare fees but at the same time be entitled to social assistance.     

Risk and its Management in Post-Financial Crisis Hong Kong

In the 1970s and up until the financial crisis occurred in the late 1990s, Hong Kong prospered in a relatively stable social, economic and political context. Since the financial crisis, however, its population has been increasingly exposed to risk: there has been job uncertainty and decreasing capacity for self‐reliance, leading to a growing reliance on public welfare and on families at a time when both are under pressure. The old welfare policies, unable to cope with the new risks, have been replaced by neo‐liberal reforms, redistributing the roles and responsibilities of the individual and the state, with a greater burden falling on the former. Individuals are required to be prudent to manage risk. While these reforms have relieved some of the burden on the state, both new social risk groups and ‘net taxpayers’ considered themselves to have borne disproportional costs. Society is facing serious problems resulting from ineffective old welfare policies, new social risks due to new policies, and the political upheavals arising from increased social conflicts and weakened social cohesion and solidarity. A further complication is that there is no acceptable platform or agent to negotiate a compromise between the polarized groups. This article argues that reliance on publicly funded risk coping strategies or on neo‐liberal risk prevention and mitigation strategies is not a desirable and sustainable policy. A commonly accepted political platform is required to negotiate a compromise which emphasizes shared and balanced roles and responsibilities, and a well‐conceived combination of risk prevention, mitigation and coping strategies.     

Social investment,social service and the economic performance of welfare states

This article begins with an examination of the role of social services as the key instrument of social investment strategy, presenting an empirical analysis of its impact on economic performance. A pooled time series, cross‐section analysis was conducted with the data of 15 welfare states from 1990 to 2007 under the ‘social investment hypothesis’ that more social service orientedness brings about a greater positive effect on the economy. The results show that a larger share of social service spending in the total social expenditure – more social service orientedness – contributes to economic growth and labour market performance, whereas a larger aggregate size of the welfare state may have a negative effect on employment. In conclusion, this study suggests that the relatively ambiguous welfare strategy of social investment could be clarified as a ‘transition from income security to livelihood security’ in which emphasis is placed on social service. Key Practitioner Message: ● This study suggests that the key instrument of social investment strategy is social service; ● The results show that more social service orientedness contributes to economic growth and labour market performance.     

Leading Article: Welfare Development in the Midst of Political Uncertainty

On 1st July 1997 Hong Kong will be transformed from a British colony into a Special Administration Region (SAR) of the People's Republic of China. Although the Basic Law, a mini-constitution for the future SAR government, states that “Hong Kong's capitalist system and lifestyle will remain unchanged for 50 years after the establishment of the SAR”, changes are perceived to be inevitable, not least in respect of the welfare policies to be implemented by the future SAR government. Indeed, since the signing of the Joint Declaration in 1984 between the British and Chinese Governments on the future of Hong Kong, the existing Colonial Government has been enlarging its role in the social services and making relevant policies more responsive to the needs of the people. These reforms have largely been carried out in line with the democratization process which Hong Kong has been undergoing in recent years. To what extent will these changes in welfare policies continue after 1997? It is argued here that with the enlargement of democracy, and especially the establishment of political parties claiming to represent the interests of the people, it would no longer be possible for Hong Kong to return to residual-type welfare programmes. While it would be unlikely for Hong Kong to develop into a “welfare state”, the future development of social services in Hong Kong would probably command widest acceptance if policies keep in line with the prevalent welfare ideology which stresses, on the one hand, the self-reliance of the people and, on the other, the responsibility of government to look after weaker members.     

Value orientations of social welfare policy structures

Substantial literature exists around the variation of welfare policy development in liberal democracies. The contrast of the American welfare state to those in Europe has sparked significant analytical literature about which factors are most significant in the variation. The literature extensively examines many of these factors but has neglected the significance of social values. This article discusses values and policy development as a foundation for further studies linking specific values to policy and institutional development. First, I discuss theorists who have identified value orientation as significant to welfare state variation; second, I review the major comparative welfare state literature. Finally, I discuss the major variation categories through the lens of social values by identifying the significant value orientation of sample policy structures. Comparative welfare state literature benefits from elucidating the values orientation of welfare policies that define the welfare state typological categories. Including the role of social values in welfare state comparisons promotes greater understanding of the origins and trajectory of current policy. Key Practitioner Message: ● Increase understanding of welfare state variation factors; ● Frame questions about social values reflected in social policy.     

Welfare programs and the state economy

Welfare policy has been controversial and support is often drawn along political affiliation lines, the economic return of investment in welfare programs is frequently cited as a justification for new and expanded policies. To investigate the direct and indirect effects of welfare programs on economic performance, the authors develop a multilink approach, through employment and investment. The relationship is then tested with data from each of the United States from 1976 to 2006. Findings show welfare programs have no direct effect on a state's economy. Indirectly, welfare has a negative effect through investment, though the effect on employment is minimal.     

Social investment effects of public education,health care,and welfare service expenditures on economic growth

The purpose of this study is to theoretically and empirically examine whether public spending in education, health care, and welfare service operates as a fruitful investment in welfare states, which has been implied in the literature of social investment arguments. Based on comprehensive review of existing literature, this study suggested a tripartite mechanism of social investment effect of such spending, that is “enhancement of human capital,” “support for labor force participation,” and “job creation.” To find the empirical evidence, a pooled time‐series cross‐section analysis was conducted with the data of 15 advanced welfare states from 1980 to 2015 using estimation technique of fixed‐effect model. The results confirmed that public spending in education, health care, and welfare service had a positive medium‐term as well as long‐term effect on economic performance, while cash‐type welfare spending had an obscure or no visible effect on economy. Government consumption that is a proxy and control variable of size of the welfare state showed a positive effect on real GDP in the medium term but a negative effect in the long run. In conclusion, this study suggests that reinforcing social services should be recognized and dealt with as essence of social investment strategy.     

Swedish Family Policy – Continuity and Change in the Nordic Welfare State Model

The main question addressed in this regional issue is whether or not the Nordic welfare states can still be considered a distinct welfare regime cluster given recent changes, such as the introduction of more private elements into the welfare state. The Nordic welfare states are often described as emphasizing full employment, economic and gender equality, and universal access to cradle‐to‐grave welfare state benefits and services. In the case of Sweden, often pointed to as the model of a social democratic welfare state, such elements remain intact in most aspects of the welfare state, even given the challenges presented by the global neo‐liberal economic paradigm since the 1970s. One way to determine whether or not the Nordic welfare states remain a distinct cluster is to provide an in‐depth examination of various welfare state policies in each Nordic country. To contribute to this analysis, an investigation of family policy in the Swedish context will be provided. Even given recent challenges, such as the introduction of private for‐profit childcare providers and a home care allowance, I argue that Swedish family policy has remained largely social democratic in its underlying goals, and thus acts to support the case for a distinct Nordic welfare regime cluster.     

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 .