Abstract

Social expenditure plays an important role in European Union (EU) countries. It improves the lives of citizens whose welfare is endangered due to poverty or illness. However, social expenditure represents a considerable share of the budgets of EU member states. Despite evident similarities in their levels of development, EU countries show apparent differences in social expenditure levels. Therefore, this work aims to determine the similarities and differences between EU countries in this regard. The analysis uses clustering methods, such as hierarchical cluster analysis and the k-means, to divide countries into homogeneous groups. The research demonstrates significant differences between EU countries in the years 2008–2018, which resulted in a low number of objects (countries) in the identified groups. In the case of 6 out of 28 countries, it was not possible to assign them to any group. The research proves that EU countries should take more care when organising their social policy, taking into consideration cultural and social factors.

Highlights

  • The government social expenditure is part of social policy and comprises a considerable share of the European Union (EU) member states’ budgets

  • The data analysed in this study came from the Eurostat database, General government expenditure by function (COFOG [gov_10a_exp]), and cover the years 2008– 2018

  • The coefficient of variation exceeded 10% in Hungary, Latvia, and Malta, while its value was below 5% in the Czech Republic, Denmark, France, Italy, Luxembourg, the Netherlands, Slovakia, Sweden and the United Kingdom (UK)

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Summary

Introduction

The government social expenditure is part of social policy and comprises a considerable share of the EU member states’ budgets. These funds are dedicated to diverse social security programmes. It has been pointed out that the amount of government expenditure does not achieve the expected results in reducing the inequality gap. Findings from these studies prove that the same improvements in the social situation could be achieved using better policy rather than higher volumes of spendings [2, 3, 29, 48]. That is why there is a need to recognise these differences

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