The retrenchment of public pension provision in the liberal world of welfare during the age of austerity—and its unexpected reversal, 1980–2017

Pension system adaption during the “age of austerity” since 1980 is expected to vary between industrialized countries broadly in line with their membership of conservative, liberal, or social democratic worlds of welfare. Empirical testing on the liberal world focuses on the later period and differs in its conclusions. This paper is based on a systematic study of the scale, nature, and trajectory of change in six liberal pension systems between 1980 and 2017 using expenditure, economic, demographic, and social rights data. These data are analysed using a framework developed through critical engagement with Pierson's three welfare state change criteria and the welfare state “dependent variable problem.” The paper finds a significant retrenchment of public pension provision in most liberal welfare states after 1980 but largely during the first half of the period. This has been partly reversed in most countries since the mid‐1990s, though the scale of this reversal varies between countries. The recent rise of the state in liberal systems has been noted by some commentators, but to be properly understood, the paper argues, it must be considered in the context of the significant retrenchment, which preceded it. There is a scope especially for research on the broader social context of recent reforms, particularly how middle‐income groups were affected by retrenchment and how recent reforms have mitigated this.     

R&;D cooperation in emerging industries,asymmetric innovative capabilities and rationale for technology parks

Starting from the premise that firms are distinct in terms of their capacity to create innovations, this article explores the rationale for R&D cooperation and the choice between alliances that involve information sharing, cost sharing or both. Defining innovative capability as the probability of creating an innovation, it examines firm strategy in a duopoly market, where firms have to decide whether or not to cooperate to acquire a fixed cost R&D infrastructure that would endow each firm with a firm-specific innovative capability. Furthermore, since emerging industries are often characterized by high technological uncertainty and diverse firm focus that makes the exploitation of spillovers difficult, this article focuses on a zero spillover context. It demonstrates that asymmetry has an impact on alliance choice and social welfare, as a function of ex-post market competition and fixed costs of R&D. With significant asymmetry no alliance may be formed, while with similar firms the cost sharing alliance is dominant. Finally, it ascertains the settings under which the equilibrium outcome is distinct from that maximizing social welfare, thereby highlighting some conditions under which public investment in a technology park can be justified.     

Empowerment and globalisation in a Nordic social work education context

The Nordic countries have been experiencing paradigm shifts from a focus on problems, pathology and deficits to more strengths-based, capacity-building and inclusive approaches, especially in the field of child welfare. This article describes joint Nordic (Nordplus) Master level courses that have been introduced to promote a more inclusive and empowering way of working with children and families. The overall theme of the Nordplus project is democratisation of child welfare work. The project includes three separate courses: (i) Empowerment and family decision making in child welfare; (ii) Strengths and solution oriented child welfare work; (iii) Children, youth and participation. The project brought together masters students from the Nordic countries and professional academics from the Nordic countries, South Africa and Australia. This article describes and problematises the learning process and the outcomes of the project. An important aim of the project was to interrogate the relationship between the global and the local.     

Risk assessment and domestic violence – how do child welfare workers in three countries assess and substantiate the risk level of a 5‐year‐old girl?

This paper examine how a sample of 301 child welfare workers in Norway, England and California, USA assess risk in cases of domestic violence. Decisions in child welfare cases are made under a high degree of uncertainty, and by using the vignette method, we explore whether child welfare systems and risk assessment approaches result in different assessment of risk level and substantiations. We find both cross‐country differences and similarities: Norwegian workers consider the risk level to be significantly higher than their peers in England and USA. However, workers' justifications for and identification of decisive factors in the case are strikingly similar across countries. These similarities are observed for both high‐risk and low‐risk assessors, and they may exist due to widespread knowledge about domestic violence and its negative consequences. We argue that the international differences in risk level assessments are due to system differences in the countries studied.     

Efficient enrollments using high tuition-high aid

The goal of high tuition-high aid is to charge high-pay residents the nonresident tuition net of the state subsidy to support low-income residents. This approach often ignores differences in program costs and presumes the state appropriation will not react. Here tuition and subsidy structures are developed as rules in a welfare-maximization framework. Once fixed costs are accommodated, low-pay resident enrollments can be admitted at marginal cost, thereby achieving efficient enrollments. The models are applied to Penn State University, where it is shown that high tuition-high aid can approximate actual tuition policy, accommodate enrollments of low-income students, and increase total welfare.     

Modeling the welfare impacts of agricultural policies in developing countries

This paper presents a new model incorporating features of developing country agriculture likely to shape the welfare outcomes of alternative agricultural policies. The model features heterogeneous households linked through markets in a rural economy-wide structure, with endogenous market participation for farmers facing transactions costs. We use it to simulate the impacts on rural welfare of market price supports, production subsidies, input subsidies, and the removal of transaction costs. Applications to six countries demonstrate the diversity of potential impacts, exhibit some systemic differences compared with impacts in developed countries, and identify specific circumstances under which market interventions may be only slightly less efficient than direct payments at transferring incomes to rural households.     

Increasing conflict in times of retrenchment? Attitudes towards healthcare provision in Europe between 1996 and 2002

Public opinion is considered a major obstacle to changing the status quo of welfare state policies. Yet some far‐reaching reforms and gradual changes of European welfare states prompt the reverse question: Have increased reform pressures and restructuring efforts led to changes in individual attitudes? In line with previous research, I found that the strong support for a public provision of healthcare remains unchanged. But what about the structure of attitudes? Testing core assumptions of the new politics theory and power resources theory, I looked at conflict lines within society and how they change in times of retrenchment. Analysing individual attitudes in 14 European countries between 1996 and 2002, I moved beyond static comparisons across countries to provide a dynamic account of trends over time. Observing stability, not change, I found no evidence that the relevance of old cleavages is in decline. Both old and new cleavages shape individual attitudes.     

Welfare service privatization and opinions about service quality: The role of political ideology among local politicians and the public

In this article, we join the discussion about the potential consequences of welfare service privatization by examining the relationship between the privatization of welfare service delivery and public opinion about service quality in Sweden. Due to the politically polarized debate about welfare service privatization in Sweden, we also examine the extent to which individualsapos; ideological orientations influence this relationship in both local politicians and ordinary citizens. For local politicians, the results show that a higher municipal degree of privatization is generally associated with slightly lower levels of satisfaction overall with welfare services, although no such relationship exists for the public. Most importantly, however, the results indicate that political ideology constitutes an important moderator in the relationship between privatization and opinions about service quality. Local politicians and, to some extent, ordinary citizens who place themselves to the left on the ideological left–right scale tend to be less satisfied with services as the municipal degree of welfare service privatization increases. For local politicians who position themselves far to the right on the scale, the relationship between welfare service privatization and satisfaction is positive. These findings suggest that there is no clear-cut relationship between privatization and individualsapos; opinions about services; rather, this relationship depends on the ideological predispositions of local politicians and ordinary citizens.     

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.     

From the Cradle to the Grave: Funeral Welfare from an International Perspective

This article reports on a pilot study examining funeral welfare for citizens from low income backgrounds. Through a review of funeral welfare provision in 12 capitalist democratic countries it seeks to inform the current system of state support in Britain, arguing that insufficient attention has been given to funeral costs as a policy issue. Mindful of the British welfare state's original ‘cradle to grave’ ethos, such attention is ever more pressing in light of rising funeral costs, an ageing population and projected increases in the death rate. Arguing that funeral costs are an issue of income support, the article draws on Esping‐Andersen's threefold welfare‐regime typology to situate the British system within a comparative study of funeral welfare that identifies similarities and differences both within and between the three welfare‐regime types. On the basis of an empirical example, the article further argues that systems of funeral welfare reflect the relationship between culture, politics and local practice. The findings indicate that the British system is hampered by a discourse of welfare dependency rather than entitlement, which stigmatises those who need support with funeral costs at a time when they are under pressure to ensure that the deceased person receives a ‘dignified’ send‐off.     

Renewable energy,CO2 emissions and economic growth in sub-Saharan Africa: Does institutional quality matter?

Renewable energy appears to be the most optimal alternative to fossil fuel and the widely accepted pathway towards the mitigation of climate change. However, the costs of adopting renewable energy are high, and it appears the wealth of nations, the stages of economic development and growth and institutional willingness and quality are important in winning this global challenge. However, there is limited information on the interplay of all the factors that are perceived as critical in moving the world towards the use of renewable energy sources to meet most of the domestic and industrial energy needs. This study investigates the inter-temporal causal relationship between institutions, renewable energy, carbon emissions and economic growth for 45 sub-Saharan Africa countries using annual data for the period 1960–2017. We used the generalised method of moment panel vector autoregression (GMM-PVAR) technique to explore the linkages. From a general perspective, the results reveal that no causal relationship exists between institutions and economic growth, but a bidirectional causality exists between economic growth and renewable energy. Our results indicate that economic growth causes carbon emissions, and institutions are more likely to respond to carbon emissions and renewable energy but prompts no causality exists between carbon emissions and renewable energy. Interestingly, these results differ between countries with different institutional origin. The policy implications are discussed.     

The Population's Confidence in the Child Protection System – A Survey Study of England,Finland, Norway and the United States (California)

This article examines the confidence the population (N = 4,003) has in the child welfare system in four countries – England, Finland, Norway and the USA (California). We find that about half or less of the population reports having confidence in the system, which is slightly higher than the confidence in the civil servants in the same countries. The Nordic countries display more confidence in the child welfare system than the Anglo‐American countries. The similarity between the countries is, however, greater than anticipated. As for independent variables that can shed light on differences in confidence levels, we find three variables to be related to a higher confidence level, and these are a left wing political orientation, lower age, and higher education. This study contributes in filling a knowledge gap on studies about trust in the child welfare system, but we emphasize that we have studied an aspect of trust that rests on the population's impressions of a system, and not their substantial knowledge about, or identification with, this system.     

The Influence of “Made in China” on the Great Moderation of the Global Economy：An Empirical Test Based on Value Chains*

We have collected data on China’s 22 main trading partners for 1984-2012 and used System GMM to study the influence of “Made in China” on the “Great Moderation” of the global economy. Our research shows that although trade scale, real effective exchange rate, oil prices, fixed capital investment and other variables have significantly expanded global economic volatility, “Made in China” has markedly restrained output growth rate fluctuations in countries around the world and price fluctuations in developed countries, helping the global economy develop with “high growth, low volatility.” “Made in China” is a long-term variable in the context of the global value chain. China needs to take advantage of global value chain restructuring to further upgrade and develop processing and manufacturing industry and expand its presence in the international market. It could choose to adopt a “mirror strategy” and launch trade sanctions targeting counterpart industries or enterprises to counter irrational trade sanctions from the developed countries. At the same time, however, it is important for China to make its own contribution to improve global economic governance and building a new international economic order in the era of global value chains by strengthening its policy coordination with other countries.     

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.     

Slippery Concepts, Shifting Context: (National) States and Welfare in the Veit-Wilson/Atherton Debate

The debate between Veit‐Wilson and Atherton raises key conceptual questions for the analysis of welfare states. Veit‐Wilson, in particular, focuses on the important, but strangely neglected question of when and why a state qualifies as a welfare state. Atherton usefully draws attention to historical debates about the legitimate purposes of state welfare policies and worthy recipients of state benefits, particularly in the Anglo‐Saxon countries. His contribution may draw our attention to the shifting meaning of concepts (such as poverty) over time. In this contribution I seek to broaden the debate. First, without underestimating the importance of such criteria, rather than presenting one single (normatively based) “discriminating criterion” defining welfare statehood, I argue that other conceptions of “the welfare state” may be useful as well—so long as analysts are clear and explicit about how they are using the phrase. Second, in the current conjuncture of the perceived “transformation” perhaps even “destruction” of the welfare state, historical and comparative research grounded on clear and explicit concepts is crucial.     

Are Scandinavian Countries Different? A Comparison of Relative Incomes for Older People in OECD Nations

Recent research has cast some doubt on the consistency of models that isolate Scandinavian countries as different to other nations in terms of egalitarian welfare states. For example, it has been argued that if occupational welfare polices have their contribution to national welfare better accounted for in comparative models, or if there is a focus on specific aspects of welfare coverage, then Scandinavian welfare states look less different to other European countries. Using case‐based methods that try to balance the demand for generalizations and the qualitative integrity of the case, this research examines the specific case of income protection for the older population post‐retirement, to see if Scandinavian countries emerge as consistently different when compared with other OECD nations. Scandinavia can be clearly identified in a separate cluster, but it is not alone and other countries also share its similarities. In particular, Scandinavia emerges in a cluster that provides more income replacement and protection for women. In part, this is reinforced by the high rate of labour participation by women in Scandinavian countries. However, there is little evidence of Scandinavian countries retaining noticeable differences and divergence in income protection policies for men.     

Concepts of poverty and exclusion in Europe

Using subjective materials, the article examines variation in the concepts of poverty and social exclusion in Europe, the aim being to examine both general and individual opinions. According to our first hypothesis, the higher the welfare expenditure is as a percentage of gross domestic product, the less subjective poverty and social exclusion there is. With the exception of Finland, subjective poverty did correlate inversely with social welfare expenditure as a percentage of gross domestic product, thereby supporting our hypothesis. Higher social welfare spending does not seem to affect perceived exclusion as much as perceived poverty. Our second hypothesis was that people in countries with low welfare expenditure are more optimistic that both poverty and social exclusion can be reduced. According to the respondents, exclusion and poverty had increased least in the Mediterranean countries and most in countries with high welfare expenditure. The same trend would appear to continue in the expectations for the future.     

Entry rates and the risks of misalignment in the EU8

New member states will join the EMU in the coming years. Setting the central parity at which they will join has been and will be a challenging task, as there is a considerable amount of uncertainty, both from a theoretical and an empirical perspective, surrounding the determination of the optimal exchange rate. Given the probable difficulty in evaluating the equilibrium rate it is thus advisable to focus on the effects of a misalignment of the entry rate for the economy, as it has implications for countries’ real and nominal convergence. An overvalued exchange rate would have an adverse impact on a country's competitiveness and its growth, while an undervalued currency would contribute to an overheating of the economy and an excessive inflation. The objective of this paper is to better understand the role of the entry rates for short run inflation and GDP developments and their implications for the inflation criterion and the real convergence process. Having estimated equilibrium exchange rates for eight out of ten countries that entered the EU in May 2004: Czech Republic, Estonia, Hungary, Lithuania, Latvia, Poland, Slovenia and Slovakia we conduct simulations showing what their adjustments to equilibrium would be if their entry rates deviated from the optimal ones.     

Wagner on government spending and national income: A new look at an old relationship

The validity of “augmented” Wagner’s Law is evaluated using a sample of twelve OECD countries over the period of 1995–2015. The bootstrap panel Granger causality approach is utilized to detect the direction of causality between government spending and GDP, focusing on cross-sectional dependence, slope heterogeneity, and structural breaks. The results show a causal relationship in favor of Wagner’s Law in seven countries, thus GDP is long-run forcing to government expenditures and that the causality runs from the former to the latter variable. The policy implication of the findings is that the upholding of Wagner’s Law in the presence of aging population growth and increasing demand for welfare services may force policy makers to raise taxes or it leads to excessive borrowing which might affect sustainability of public finances.