The Welfare State and Democracy: On the Development of Social Security in Southern Europe, 1960–90

ABSTRACTThe theories and evidence about relationships between democracy and social spending in Latin America are highly contested. A recent study shows that collective protest by organized labor effectively increases social security and welfare spending, whereas mass protest does not have comparable effects on human capital spending in Latin American democracies. This article reexamines the analysis and demonstrates that organized labor alone cannot sway democratic governments. Labor strikes require the synchronizing effect of mass protest to obtain government concessions. Only through concurrent episodes of mass protest can organized labor overcome the numerical disadvantage of pressing democratic government for social welfare spending. In understanding the relationship between labor protests and social welfare spending through the lens of insider-outsider dichotomy, it is critical to consider the synchronizing effect of mass protests. The findings remain robust with alternative measures of democracy and various model specifications.

ObjectivesTo assess the effect of social spending on population health.DesignMultivariate regression analysis was performed to investigate the relationship between age-standardised cause-specific mortality rates and social spending. Mortality data were collected...

Comment on “Meeting the Social Policy Challenges Facing Korea”

Many countries struggle with the question of appropriate social welfare spending. Here we test several hypotheses about the dynamics between social welfare spending and crime. We do so using pooled, cross-national time-series data. Our findings suggest that per capita social welfare spending is associated with lower rates of both theft and homicide. Time lagged analysis suggests that the current level of social welfare spending, not that of recent years, accounts for any possible suppression of crime. The data also suggest that, whereas high homicide rates do not appear to inspire increased social welfare generosity, lagged measures of theft rates are associated with subsequent increases in social welfare spending among high theft countries.

Preface 1. The welfare state: some neglected considerations 2. Theoretical perspectives on the welfare state 3. Social welfare spending in advanced industrial democracies 4. Social welfare spending and democratic political context 5. Economic growth, social welfare spending, and income inequality 6. Infant mortality, equality, and social welfare spending 7. Conclusions: the causes and consequences of the welfare state References.

The Costs of Risk: Examining the Missing Link between Globalization and Social Spending

In this paper, we examine the implications of the party cartel model of congressional policy making on the level of redistributional social welfare spending in the United States. The party cartel model predicts an inverse relationship between the level of spending on social welfare programs and median family income of the district that the median member of the majority party represents. Specifically, the higher the median district income of the median member of the majority party, the smaller the amount of social welfare spending Congress will allocate. To test this hypothesis, we estimate a random coefficients model using time series cross sectional data on congressional Budget Authorization for redistributional social welfare spending. We find that for each $1000 increase in median district income for the median member of the majority party, each redistributional Budget Authority sub-function decreases by an average of $489 million (for a total decrease of $3.91 billion overall). Therefore, the party cartel model appears to be a significant predictor of the level of income redistribution in the U.S.

<p>My dissertation examines the question of how foreign direct investment (FDI) affects social welfare spending across countries. To date, there have been three important challenges to studies of the globalization-welfare state nexus. First, most scholars understand market internationalization in terms of the trade of goods and services while minimizing how other aspects of globalization fit into this discussion. Second, scholarly attention to economic globalization has been mistaken when understanding the relationship between demand- and supply-side mechanisms for social welfare provision. Thus, the argument that trade stimulates demand for social welfare has been incorrectly used to oppose the argument that capital mobility significantly undercuts a government's capability to fund welfare states. Lastly, existing studies on this topic mostly center around affluent democracies; various theories of welfare states require further elaborations to increase their external validity.</p> <p>My dissertation aims to overcome these challenges. For this purpose, I focus on one of the most important aspects of globalization, FDI, which bears meaningful implications for both demand- and supply-side functions of social welfare provisions when explaining variations of social welfare spending across countries. I argue that since the late twentieth century, FDI has been a major cause of the "globalization dilemma,'' proposed by (Rodrik1997), who argues that in an age of globalization governments face increased demand for social welfare and decreased capabilities to supply it. In other words, FDI has conflicting influences on welfare states. On the one hand, FDI works for welfare states as the ensuing economic insecurity increases demand for social welfare. At the same time, however, FDI works against welfare states because governments will experience reductions in capital taxation due to competition among themselves to attract and retain production capitals. I further argue that there is an interesting consequence of this dilemma. Due to the conflicting influences of FDI on welfare states, the expansion of social welfare provisions requires governments to secure additional revenues. Governments will address this concern through a strategy that is both effective and politically less expensive: an increased reliance on indirect taxation. As indirect taxes are mostly born out of labor and thus notoriously regressive, the very effort to supply social welfare provisions goes against the fundamental principle of welfare states: the redistribution of income from the rich to the poor.</p>

This article explores whether immigration plays a role in determining national welfare state effort in 16 European countries. It examines the relationship between stocks of migrants, the foreign-born population, on two different indicators of welfare state effort – social welfare spending as a percentage of gross domestic product (GDP) and a welfare generosity index. The nexus between immigration and welfare is a controversial and highly sensitive political issue, and as such it typically divides opinion. Traditionally, it has been argued that increases in immigration create pressures for governments to reduce levels of social welfare provision. By building on theories and results from the political economy literature, this article provides further evidence on the debate through using a fresh approach to operationalize welfare state effort. The empirical results show that the foreign-born population has a positive and statistically significant relationship with social welfare spending and no statistically significant association with the welfare generosity index. The findings provide no evidence to support the hypothesis that the higher levels of immigration lead to reduced levels of social welfare provision. On the contrary, these findings lend support to the view that increasing immigration leads to welfare state expansion rather than retrenchment, and that European welfare states remain resilient in the face of the globalization of migration.

A major question of political economy is why and under what conditions welfare state expansion and retrenchment takes place. We examine the impact of the Great Recession of 2008–2009 on welfare policies of the American states. The analysis examines social policy spending in the American States for periods ranging from 1982 to 2011. The results suggest that social welfare spending is higher with better economic conditions in general but also with higher poverty rates. Liberal citizens and governments and Democratic majorities in the state house produce higher welfare spending. There is a trade-off between education and social welfare spending. Controlling for political, social, and economic conditions that affect state welfare policy, the years of the Great Recession saw a contraction of spending on social welfare programs in general and Temporary Assistance to Needy Families in particular, but an expansion of support for Medicaid.

This article analyzes the relationship between collective protest and social spending in Latin America from 1970 to 2007. I argue that under democracy, organized labor is in a better position relative to other groups in society to obtain social policy concessions as a consequence of their collective action efforts. Labor insiders mobilize around specific demands, and labor strikes carry significant economic and political costs on governments. In contrast, other groups in society rarely protest around specific social policy issues and are more often subject to successful demobilization tactics from political leaders. Results from an error correction model (ECM) show that in democracies, collective protest has differentiated effects on social spending. While strikes have a strong positive long-term effect on social security and welfare spending, none of the different forms of collective protest affect education or health spending. Importantly, I also find evidence of a deterrent effect of mass protests in democratic regimes; cutbacks in human capital spending are less likely as peaceful large-scale demonstrations increase.

In this paper, we study the effects of social spending on long-term economic performance in the USA from 1949 to 2019 using vector auto-regressive models. We break down social spending into six programs to identify the economic effects of different social programs. Overall, social spending has a positive impact on private saving but an adverse effect on the unemployment rate. Due to its dominant distortionary impact on the labor market, social spending decreases GDP. However, these effects are minimal and are primarily short-term. The economic implications of the different social spending programs on the economy are similar but different in magnitude. The impact of social security and medical care spending on GDP is not significant. In turn, the adverse effects of veteran benefits and unemployment insurance on GDP are dominated by the short-term impact. In contrast, the effects of public assistance are more evenly distributed, and the adverse effects of other social assistance are exclusively long-term. Overall, the message is that although social spending adversely affects economic performance, these effects are small and primarily short-term. As such, the quest for increased social protection and improved social welfare does not seem to come at a significant economic cost. This attests to the sustainability of such policies.

The concept of social security – a contemporary, global norm – and the accompanying public expenditures are the products of a search for security against the dangers that may be faced by individuals in society. Social security spending is affected by social changes, including employment policies, labour supply, family and social structures. Countries give greater importance to social security spending for the sustainability of economic growth. This study analyses and evaluates the impact of social security spending in Turkey, Serbia, North Macedonia and Albania, which are within the scope of European Union enlargement policy, on economic growth in the 1996-2020 period. Panel data analysis was made using the growth rate of gross domestic product per capita, the population growth rate, the corruption index, contribution data on social spending and the Arellano and Bover / Blundell and Bond System Generalized Method of Moments estimator were taken into account. We conclude that social security spending positively affects economic growth and, in this context, it is in line with the theory put forward by Keynes.

This paper analyzes the role of local spending, particularly on social welfare, and local inequality as factors in the Italian political crisis following the adoption in 2011 of more radical national austerity measures. We employ two different methods. First, we develop an original database of municipal budgets. There we show that even the lowest level of social welfare spending, that offered by Italian municipalities, though also hit by austerity, was still able to moderate this national shock. We test three operationalizations of local spending: aggregate current expenditures, aggregate current expenditures on social services, and current expenditures disaggregated by function. We show that municipal current expenditures, particularly on social spending, significantly affected the post-2011 share of votes for the progressive coalition. The results also show that social spending, especially on education, significantly moderated the combined effect of national austerity and the economic crisis on voting for populist radical right parties, while no significant results appeared for populist parties in general. Local inequality appears to significantly enhance vote shares of populist radical right parties and populist parties in general. We caution that, although significant, the effect is not strong: that local policy and economic conditions can moderate national shocks but cannot reverse them. The second analysis relies on survey data to ascertain the individual-level mechanisms behind the role of local welfare. The paper argues that local economic inputs influence voters’ position on non-economic issues. Our results, however, do not identify any significant individual-level channel of transmission, be it cultural or economic.

Some researchers, policy makers, and media accounts have challenged the equity of U.S. age-based social spending, invoking concerns about generational equity. The generational equity position, as expressed in the U.S. political landscape, attributes Social Security and Medicare's relative political invulnerability to elderly Americans' willingness to support spending on themselves, to the exclusion of spending on others. We use data from the General Social Survey to examine whether the preferences for increased education, health, and Social Security spending expressed by citizens of various age groups are consistent with age-based self-interest. Our findings indicate that arguments for generational spending preferences based exclusively on age are overly simplistic. A greater percentage of elderly citizens favor increased education spending compared to increased Social Security spending, while younger Americans express higher levels of support for increased Social Security spending than do elderly citizens. We find little empirical support for the negative connotations of generational equity as it applies to support for U.S. social spending.