Public Social Expenditure Research Articles

Welfare States and the Health Impact of Social Capital: Focusing on the Crowding-Out and Crowding-In Perspectives

In recent decades, studies in various countries have found that social capital, such as social trust and civic participation, improves health. However, some studies have suggested that the influence of social capital on health may vary depending on welfare provisions because social policies may alter how social capital works. Therefore, this study adopts the crowding-out and the crowding-in perspectives to conduct an international comparative analysis to investigate whether welfare provisions affect the impacts of cognitive and structural social capital on self-rated health. This analysis uses the pooled data from the World Values Survey and cross-classified full models to examine the cross-level interaction effects of public social expenditures (PSE) and two types of social capital, specifically, social trust and civic participation, on self-rated health. The results of this study indicated that the cross-level interaction effects of PSE and the two types of social capital on self-rated health were positive and significant. These results suggested that welfare provisions may enhance the effect of social capital on health.

Financial resource of public social security expenditure, the rule of law, and economic inequality: international comparison of legal origins

This study indicates that the strength of the rule of law affects social security expenditure and its financial resources. However, legal origins affect the strength of the rule of law. We use data from 36 member countries of the Organisation for Economic Co-operation and Development. The legal origins affect the rule of law and have different marginal effects on public financial resources. Further, social security expenditures have a correction effect on economic inequality. However, the marginal effect of the social security expenditure on economic inequality differs based on its legal origins. Increasing social security expenditure affects correcting economic inequality to elaborate concerning all legal origins. Particularly in countries that adopted French legal origins, high social security expenditure further improves economic inequality. In contrast, increases in social security expenditures of countries with English legal origins do not improve economic inequality to a large extent. The results of this study suggest that differences in legal origins result in various types of capitalism.

지자체 당파성은 복지지출에 영향을 미치는가?: 자체복지사업 지출분석을 통한 검증

본 연구의 목적은 지방정부의 당파성이 복지지출에 어떤 영향을 미치는지 실증적으로 규명하는데 있다. 지자체 사회복지사업을 OECD SOCX 기준에 따라 전수 분류해 구축한 ‘지자체 복지지출DB’를 활용하여 지방수준의 당파성 효과 분석연구의 타당성과 신뢰성을 높였다. 본 연구를 통해 밝혀진 주요 연구결과는 크게 세 가지다. 첫째, 기초 지방자치단체 수준에서 단체장의 당파성은 복지지출에 영향을 미친다. 둘째, 지방의회의 당파성과 복지지출의 관계는 비선형적이고, 단체장의 영향에 비하면 무시할 정도이다. 셋째, 좌·우 정당 간 경쟁이 사실상 무의미한 호남에서 당파성과 복지지출의 관계는 사라지거나 권력자원론에 반하는 결과를 보여준다. 본 연구는 엄격한 연구설계를 통해 변수의 지표 선정과 측정을 합리적으로 재설정하여 실증분석을 시도함으로써 그동안 불일치해왔던 지방정부의 당파성과 복지지출 간 관계 연구에 권위있는 분석 결과를 제시하였다는 점에서 연구의 의의를 찾을 수 있다.

The Relationship Between Tax Revenue and Public Social Expenditure in the EU Member States

Purpose: The objective of this paper is to identify, with the use of statistical methods, the relationship between the level of fiscalism and the ratio of social expenditure to the total public expenditure in the EU-28. Design/Methodology/Approach: Linear regression and correlation were used to assess the interdependence between the tax revenue-to-GDP ratio and the ratio of social expenditure to the total public expenditure in the EU-28. Then, using the direction of the slope as the criterion, the EU 28 were classified into countries with a positive relationship (the lower and upper border of the confidence interval are positive) and countries with a negative relationship (the lower and upper border of the confidence interval are negative). Findings: The research confirmed that the EU Member States with a high level of fiscalism in 2004-2018, in principle, were characterised by the following interdependence: the higher the tax revenue-to-GDP ratio was, the higher the ratio of social expenditure to the total public expenditure was. After the decomposition of public expenditure, a similar relationship was identified for public expenditure on social protection, while no such relationship was identified for other categories of expenditure for social purposes. Practical Implications: The research results are important as the EU-28 are striving to maintain fiscal stability. The research findings point to the need of verifying the tasks in the field of social protection in countries with a high level of fiscalism. Increasing these tasks, mean a further increase in the tax burden on the economy. Originality/Value: The research adds value to the testing of the fiscal-synchronization hypothesis. The originality of the research mainly results from its detailed nature. The relationship between the level of fiscalism and public expenditure was identified not in general terms but incurred for tasks related to the implementation of social policy in the individual EU-28.

National Social Benefit Systems and Entrepreneurial Intentions: A Cross-National and Cross-Level Analysis

In this study, we examine how social benefit systems (public and private social expenditure) may influence entrepreneurial intentions, and how it may moderate the relationship between fear of failure and entrepreneurial intentions. Our cross-level model of 97,012 people from 32 countries demonstrates that individuals in countries with high levels of public social expenditure are less likely to show entrepreneurial intentions because they compare and contrast the safety net provided by social systems versus risk associated with starting a business. In addition, the results show that higher levels of private social spending weaken the negative impact of fear of failure on entrepreneurial intentions.

The Role of Social Capital and Welfare in Absenteeism Across 26 OECD Countries: Moderating Effect on Employment and Working Conditions.

This study attempted to investigate social contextual effect on the occurrence of workers' absenteeism. Survey data on 30,913 wage workers in 26 countries were linked to the indicators for social capital and welfare from the national database. Multi-level logistic regression was used for analyses. Employment contract, atypical work, physical and psycho-social working conditions (effort and reward), social capital and welfare significantly explained the differences in occurrence of absenteeism across countries. Analysis of cross-level interactions revealed that macro indicators related to social capital, and public social and health expenditure had moderating effects on the relation between individual-level factors and absenteeism. High level of public spending on welfare policies and social bonding decrease the risk of absenteeism caused by vulnerable working environments, but it also worsen gaps in coping capabilities of workers in non-permanent contract and atypical work pattern.

Is there anything Left? The politics of social spending in new democracies

AbstractThe evolution of public social expenditures displays divergent patterns across non‐western countries. This exploratory article argues that in order to understand the domestic sources of this divergence, institutional and structural explanations should be complemented with an actor‐oriented perspective. Analyses of the role of party politics in non‐OECD democracies, through multivariate fixed‐effect regressions using data from 46 countries between 1995 and 2015, reveals a robust positive association between shifts towards Left party government and increases in total public social expenditures, also when controlling for structural and institutional factors. This association however seems potentially conditional on sufficient levels of economic growth. While indicating an impact of partisanship, further research is arguably needed regarding the origins, organization and policy outputs of parties in more recently democratized countries, as well as regarding the conditions under which the ideological orientation of parties in government are actually consequential.

The relationship between different social expenditure schemes and poverty, inequality and economic growth

AbstractIn this article, we study how social expenditure is related to poverty, income inequality and GDP growth. Our main contribution is to disentangle these relationships by the following social expenditure schemes: 1) “old age and survivors”, 2) “incapacity”, 3) “health”, 4) “family”, 5) “unemployment and active labour market policies” and 6) “housing and others”. For this purpose, we employ OLS and 2SLS regression models using a panel data set for 22 Member States of the European Union from 1990 until 2015. We find total public social expenditure to be negatively related to poverty and inequality, but not related to GDP growth. The results vary substantially between the different social expenditure schemes, which makes more accurate targeting possible.

Effectiveness and Equity in Social Spending - The Case of Spain

Spain is experiencing sustained economic and social disparities in several areas. Social spending policies have a heightened responsibility to respond but are challenged by high public debt and pressures from an aging society. This study takes stock of the level and effectiveness of public social expenditure from a cross-country and macroeconomic view, complementing recent targeted spending reviews. The results suggest that social protection spending should aim to improve redistribution through better targeting the most vulnerable while more effective education and active labor market policies should aim to create more equal opportunities and income prospects. In some areas more fiscal resources are needed. But social spending alone cannot reduce inequality, and efforts also should be directed toward making the labor market more inclusive.

Effectiveness and Equity in Social Spending - The Case of Spain

Spain is experiencing sustained economic and social disparities in several areas. Social spending policies have a heightened responsibility to respond but are challenged by high public debt and pressures from an aging society. This study takes stock of the level and effectiveness of public social expenditure from a cross-country and macroeconomic view, complementing recent targeted spending reviews. The results suggest that social protection spending should aim to improve redistribution through better targeting the most vulnerable while more effective education and active labor market policies should aim to create more equal opportunities and income prospects. In some areas more fiscal resources are needed. But social spending alone cannot reduce inequality, and efforts also should be directed toward making the labor market more inclusive.

The Nexus between Welfare State and Subjective Well-Being: A Multi-Level Assessment

This article explores the nexus between welfare state and subjective well-being in 20 countries drawing on data from World Value Survey, wave 6. Multi-level mixed-effects restricted maximum likelihood approach that uses fixed-effects and random-effects techniques was applied. This article argues that national differences can explain little of the variations in citizens' subjective well being. In relatively developed welfare states, the effect of welfare typologies on individual-level subjective well-being is insignificant. However, there is a visible difference in subjective well-being between citizens living in and out of European/OECD welfare regimes. Moreover, while higher public social expenditure exerts higher aggregate subjective well-being, there is no connection between the spending and individual-level subjective well-being. What is more, net pension replacement rate does not have an effect on aggregate and individual-level subjective well-being.

Норма валового заощадження: теорія та практика

Scientific justification of the rate of gross savings is one of the key issues in the models of economic growth and a fundamental parameter of economic architectonics in the context of long-term dynamics of growth and structure of total demand. The article aims at demonstrating the genesis of the theory of the rate of gross savings beginning from the classics of political economy to theoretical justifications of the endogenization of the rate of savings in the models of economic growth as well as a detailed consideration of the components of gross savings with the analysis of the factors affecting its level (based on statistical data). It is exactly the empirical analysis that allows testing the validity of theoretical concepts and determining the correctness of the theorists' conclusions. The author shows a great gap between the classical view of the savings rate as a result of the action of natural law, which leads to self-regulation of the parameters of production reproduction, on the one hand, and the purely rational views shaped during the formation and development of the theory and models of economic growth, on the other. Empirical studies have shown that the rate of savings and the rate of capital accumulation are different in the economies of different countries and depend on: the degree of government intervention in the distribution of gross disposable income between institutional sectors and in the structure of households by income level, the level of public social transfers, the depth of income misbalances and expenditure of the institutional sectors and, accordingly, their net borrowing and accumulated debt, as well as on the current phase of the economic cycle and quality of the investment environment. The practical relevance of the study is important to substantiate fiscal policy, especially regarding its impact on the level of gross savings in the non-financial corporations and government sectors, as well as the level of public social and capital expenditures. The article was written within the project on «Macro-prospects of the endogenization of Ukraine’s economic development» (state registration number 0117U006435).

Pobres y electores. Universalidad y focalización de la política social en la República Dominicana 2006-2012

Este trabajo analiza el uso estratégico del gasto social en la República Dominicana a la luz de las partidas destinadas a financiar la seguridad social y los programas asistenciales en el periodo 2006-2012. Los datos presentados confirman el potencial politizador de los programas focalizados en época electoral y la bifurcación interesada de los regímenes de protección social.

PRESIDENTIAL ELECTIONS AND PUBLIC EXPENDITURE IN SOCIAL DEVELOPMENT IN MEXICO, 1995 – 2016

The aim of this paper is to analyze the effects of presidential elections on the government’s social expenditure in Mexico over the 1995-2016 period. To do so, extended autoregressive models are estimated for the total social expenditures and two of its main components, to take into account economics factors. Among the most outstanding results is that the growth of GDP and total government revenues play a significant role as control variables. More importantly, there is (full) evidence of a political budget cycle on the total social public expenditure and (partial evidence) on the regional development function; on the contrary, there is no evidence on the function of provision and social assistance. These results, on the one hand, support the hypothesis of opportunistic behavior of the governments to stay in power by using public resources for political clientelism and, on the other, reflect the difficulties to capture these practices.

Ethnic Heterogeneity Politics of Welfare State in the United States: A Time Series Analysis, 1940–2016

Welfare state policies in the United States have expanded significantly, with some short-term fluctuations, since the 1940s. This paper examines the politics of ethnic heterogeneity in order to explain these welfare state changes. Results from various time-series regressions of public social transfer expenditures with or without health suggest welfare state-limiting roles of race and immigration, with the growing religious heterogeneity consistently helping to bolster welfare state policies. Albeit more nuanced than groundbreaking, findings help understand the nature of the American welfare state politics driven in part by the way ethnic heterogeneity shapes the evolving public opinion and policy preferences.

Poverty Menace and Social Economic Nexus in Nigeria: A Bound Test Approach

Nigeria has recorded variations in major macroeconomic variables since independence. Growth episodes over the years though encouraging put has not translated to improvement in poverty incidence. The rate of poverty in the nation has out-grown population growth, hence, this study seeks to relate various sectors of the economy to the perturbing poverty level in the nation with emphasis on the social sectors in which health and education play integral roles. This study examines poverty and social economic mix in Nigeria with the objectives of ascertaining the partial impacts of productivity (as a measure of health outcome), public social expenditures, agricultural output, manufacturing output and infrastructural development on poverty incidence, the study collected secondary annual time series data spanning 37 years from 1981 to 2017 on poverty index (PVTI), productivity due to good health (HP) and other explanatory variables as earlier identified. The pre-estimation techniques adopted include descriptive statistics, Phillips-Perron stationarity test and bounds test to co-integration. The preliminary result reveals that the variables in the model have long run relationship. The parameters of the model were estimated using the ARDL technique and the study found that productivity due to good health (HP) has significant effect on poverty reduction, as public social expenditures, current period’s agricultural output and previous period manufacturing output have similar effects but not statistically significant, however, infrastructural development and current manufacturing output have significant positive impact on poverty incidence in the country. On the basis of our empirical revelation, the study recommends that government should adopt multi-sectoral and big push development approaches with priority on employees’ productivity through free health care programmes for the unemployed, quality health insurance scheme for the employed, free education for children of the poor and unemployed, and that investment in critical infrastructures such as roads, rail, energy and storage facilities that promote agriculture and manufacturing outputs be improved upon if poverty is to be decisively tackled in Nigeria.

Public Social Expenditures and Economic Growth: Evidence from Selected High Income States of India

The main objective of the study is to empirically evaluate the impact of the public social expenditures (education and health)on economic growth and direction of causality among the variables used at the disaggregate level (top high-incomestates of India) using time series econometric models and data set covering the period 1990–1991 to 2016–2017. The study employed the public social human capital expenditures on education and health to capture the economic growth of the states. The empirical results of the ADF test showed that the time series variables used are all stationary at first order difference at 5 per cent level of significance. The estimated results of the cointegration test showed that there was an absence of co-integration relationship (no long-run relationship) among the variables in the states of Gujarat, Jammu and Kashmir, Maharashtra and Punjab. The results of Wald statistic indicated that neither short run nor long-run causality run from education expenditure and health expenditure to the economic growth of Tamil Nadu and West Bengal. The findings of this study may be helpful for the policy-makers to amend the existing policies and budgetary allocation for the health care and education sectors of the study states.

Норма валового заощадження: теорія та практика

Scientific justification of the rate of gross savings is one of the key issues in the models of economic growth and a fundamental parameter of economic architectonics in the context of long-term dynamics of growth and structure of total demand. The article aims at demonstrating the genesis of the theory of the rate of gross savings beginning from the classics of political economy to theoretical justifications of the endogenization of the rate of savings in the models of economic growth as well as a detailed consideration of the components of gross savings with the analysis of the factors affecting its level (based on statistical data). It is exactly the empirical analysis that allows testing the validity of theoretical concepts and determining the correctness of the theorists' conclusions. The author shows a great gap between the classical view of the savings rate as a result of the action of natural law, which leads to self-regulation of the parameters of production reproduction, on the one hand, and the purely rational views shaped during the formation and development of the theory and models of economic growth, on the other. Empirical studies have shown that the rate of savings and the rate of capital ac-cumulation are different in the economies of different countries and depend on: the degree of government intervention in the distribution of gross disposable income between institutional sectors and in the structure of households by income level, the level of public social transfers, the depth of income misbalances and expenditure of the institutional sectors and, accordingly, their net borrowing and accumulated debt, as well as on the current phase of the economic cycle and quality of the investment environment. The practical relevance of the study is important to substantiate fiscal policy, especially regarding its impact on the level of gross savings in the non-financial corporations and government sectors, as well as the level of public social and capital expenditures.

Government Social Expenditure and Income Inequalities in the European Union

This paper analyzes the relationship between public social expenditure and income inequality distribution in the 28 Member States of the European Union, throughout the period 2005-2014. We estimate dynamic panel models. The results show the existence of a negative correlation between public social expenditure as a whole and income inequality. Distinguishing among different expenditure concepts, the association between social expenditure and income inequality may be different in the emerging Member States as compared to the rest of the States. In the emerging States, spending on health and spending on social protection are negatively associated with income inequality, and in the rest of States, this redistributive function is carried out only by spending on social protection. Spending on education is not significantly related to income inequality in any group of studied countries.

Child‐centered social policies in Argentina: Expansion, segmentation, and social stratification

AbstractOver the last two decades or so, social policy has expanded in many Latin American countries. In Argentina, public social expenditures increased, and new social programs were implemented to extend access to previously excluded populations. These developments also involved three child‐centered social policies: child benefits in cash, maternal and infant health care, and early child education and care. Looking at key institutional features of new programs and policies, and using data on the distribution of children's access to benefits across socio‐economic strata, this article evaluates the progress and limits of recent social policy developments to reduce segmentation and social stratification in child‐centered social policies and promote egalitarian social investment for all children.