The dualisation of unemployment compensation in emerging economies: Brazil, China and Russia

Abstract

AbstractThis article examines the development of a ‘dualised’ welfare regime –generous earnings-related unemployment compensation for ‘insiders’ andresidualneeds-based social assistance provision for ‘outsiders’ – in China and Brazil, which experienced impressive economic development in recent decades. It argues that such a welfare outcome can partly be accounted for by the ongoing influence of ‘insiders’, which was conditional upon the pace and nature of economic liberalisation reforms and their representation in institutional channels of social policy-making. It also demonstrates that the new social/unemployment assistance schemes for ‘outsiders’ emerged due to both governments’ fear of losing their power in politics; yet, these schemes were designed in a residual way since ‘outsiders’ did not possess the same political resources as ‘insiders’ did. The paper, moreover, draws from the Russian experience (a negative case) to demonstrate that such a dualised welfare outcome did not take place because the ‘insiders’ were weak, owing to a radical and orthodox liberalisation and they did not have access to institutional venues to influence social policy-making process.