Welfare States: Protecting or Risking Old Age

Abstract

The modern welfare state was created in the long economic expansion of the post-World War II era, as rising productivity and economic growth made it possible for governments to fund an array of benefits that provided a modicum of income security across the life course. Although welfare states everywhere included benefits for unemployment, health and disability, the bulk of expenditures went to public pensions. In all western capitalist democracies, expenditures for the aged represented the single largest item in national budgets. As Myles (1989:2) states, “the contemporary welfare state in the capitalist democracies is largely a welfare state for the elderly.” Public pensions made it possible for older people to retire before any actual physiological decline occurred. More importantly, they exempted the wages of the old from the control of the market with its laws of supply and demand and instead subjected them to a process of political decision-making that led to ever more generous pensions as elected officials competed to claim credit for benefit hikes.KeywordsWelfare StatePublic PensionFemale Labor Force ParticipationPension ReformPrivate PensionThese keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.