Book Review: The Political Economy of European Welfare Capitalism, by Colin Hay and Daniel Wincott

Abstract

Colin Hay and Daniel Wincott The Political Economy of European Welfare Capitalism, Palgrave: London, 2013; 280 pp: 9781403902245, $42 (pbk) There is no lack of literature addressing the paramount issue of the European welfare state within the last five decades by using different concepts, theoretical frames, approaches and methodologies borrowed from a wide array of social sciences and humanities. And yet Colin Hay and Daniel Wincott manage to bring something new into this bloc of literature. The Political Economy of European Welfare Capitalism is distinct in its accuracy in both laying down the nature and genesis of the welfare state, and also describing the challenges it faces in the modern-day global economy. The authors start from the evolution of the welfare state, portraying its main historical stages and offering their characteristics. Chapter 2 presents essential elements of welfare capitalism, its varieties and regime-clusters. After laying down the evolution and the modern content and structure of the subject matter, the authors turn to such oft-mentioned trends as globalisation and Europeanisation, and their implications for the welfare state. Major highlights here are welfare retrenchment, the 'incommensurability thesis', and a reassessment of the globalisation orthodoxy. After dealing with globalisation, the authors research a no less controversial argument about the incompatibility of maintaining competitiveness, while preserving generous welfare regimes and juxtaposing public spending with economic growth. While generous welfare regimes are commonly considered to be macroeconomic stabilisers in times of crises, they do not imply ineffectiveness, low productivity or lack of competitiveness. On the contrary, European welfare states and high competitiveness are not mutually exclusive. Chapter 6 presents an extensive discussion of convergence, starting with its concept and types, then matches convergence and divergence, and predicts continuing diversity in welfare regimes. Finally, the book addresses perspectives of the welfare state through the lens of the global financial crisis and its impact on Europe's wellbeing. The text is supplemented with a moderate number of tables and a quite significant number of figures that help present the data and trends in a more digestible manner. There is no lack of scholars who announced after the world financial crisis of 2008 that capitalism as we know it is doomed, or, indeed, gone altogether. The echo of these announcements is still being heard after five years, with capitalism as we know it' alive and well, and with no major changes in sight. In distinction from these maximalists, Hay and Wincott are more moderate in their estimates and predictions, including on the impact of globalisation on the European regional welfare state models. This modesty is based on detailed meticulous analysis, thorough work with the data, and a brilliantly utilised political economic approach. If not for this scrupulous level of analysis, the classical topic and structure would be a disadvantage of this work. …