Welfare production: Public versus private

Welfare is one of the highest values in modern societies and refers primarily to the living conditions and the perceived life quality of individuals and families. This paper is asking how welfare is generated in society, what are the producers, the products, the production processes, the limits of particular productions, and new innovative “mixes”. After a survey of the literature (theory of social production, well-being accounting, political productivity, social policy intervention), a scheme of four major institutions of welfare production is discussed: markets, bureaucracies, associations, private households. Next, the present dilemmas and the innovative potential of each particular institution and of pair-and triple combinations are briefly explored, e.g. new “corporatist” patterns. Two case studies (“shadow economy”, household production) are investigating the policy question of how private initiatives, the resources of associations and private households, and new combinations of public and private efforts may overcome some of the deadlocks in the present “market failure” and “state failure”.