Social Spending Research Articles

ОЦЕНКА ДЕФИЦИТА СОЦИАЛЬНОЙ ЗАЩИТЫ РАБОТНИКОВ НОВЫХ ФОРМ ЗАНЯТОСТИ В РОССИЙСКОЙ ЭКОНОМИКЕ

The Russian Federation has high level of social protection coverage. However, for the population that is part of the labor force, coverage of key types of social security is provided mainly through social insurance. The inclusion of citizens (as insured) in compulsory social insurance is a subject for payment of insurance premiums in their favor by employers (as insurers). Against the background of the growing involvement of the Russian population in new, non-standard forms of employment, there is an outflow of the employed population from the sphere of labor relations with social guarantees enshrined in labor legislation, into the sphere of civil law relations and even into shadow employment, as a result of which there is a risk of a shortage of social security for the economically active population. The aim of the study to assess the existing deficit of social security in Russia for workers in new forms of employment, that is carried out using legal and sociological approaches. The results of the study indicate a connection between the shortage of social security of the population employed in new forms with the lack of conscious interest among citizens in participating in insurance of possible social risks in the future, as well as the current need to purchase insurance protection at their own expense. During the transformation of the labor market and the active influx of the population into new forms of employment (including through the transition from labor relations to self-employment and entrepreneurship), the absence of a market insurance culture does not automatically lead to a redistribution of responsibility between participants in the social protection system. With a decrease in the number of employers and a consequent decrease in social protection spending, the demand for social insurance services among the population has not yet been formed. In many ways, this is due to the unwillingness of the self-employed population to lose part of their income (forming “deferred consumption”). If we turn to the figures of the average income of the self-employed, their behavior is largely understandable. In these circumstances, the problem of providing social security to the population intersects with the problem of combating poverty and low income. On the other hand, the obligations of the Russian government to provide the population with social security are enshrined in the Constitution of the Russian Federation. The decrease in participants in pension and social insurance programs today leads to a gradual increase in the deficit of the social security budget in the future, in which it will become increasingly difficult to fulfill these obligations. It can be assumed that this is one of the main reasons determining the government’s interest in expanding activity in relation to social protection policy. At the same time, employees of new forms of employment, guided more by the value of “earning now”, do not show significant interest in voluntary insurance programs. In such a situation, it is possible to assume an increase in the gap between the satisfaction/sense of security of workers in new forms of employment and their growing anxiety about the social policy being implemented in the country. To conclude, Russia is currently in a “transitional stage”, when an active search is underway for a balance between legal access to social protection and demand for specific areas of social protection that requires gradual, careful work on the part of the state, with consultations with “new social partners” (for example, digital labor platforms and platform workers), as well as the selfemployed and their associations. In this context, the development of new instruments of social partnership and state regulation of social protection mechanisms for the population involved in new forms of employment seems to be an important and priority task in the near future.

Пакистан – Международный валютный фонд: помощь или вызов экономическому суверенитету?

Pakistan has faced economic challenges in recent years amid rising global crude oil prices and hydrocarbon import bills: free fall of the rupee, high interest rates, elevated fiscal deficits, 37% inflation, falling stock market, and as a result – shrinking industrial production and elimination of social welfare spending. The borrowings from the IMF, China, and Gulf countries to restore foreign exchange reserves and lack of capability to return them convinced the military-civil authorities in 2023 to declare a threat to the country’s economic sovereignty. The 2019 IMF financial assistance program approved the allocation of 6.5 billion USD until 2023. In 2023, the Fund approved an additional Stand-By Agreement in the amount of 3 billion USD. Basic requirements of the IMF included tightening of credit and financial policy; conducting reforms to improve budgetary discipline and broaden the tax base; reducing public debt; etc. The authorities took a number of urgent measures, first of all, they increased electricity tariffs and the amount of collected taxes. Pakistani society has been critical of the IMF’s demands, especially the increases in electricity tariffs and cuts in social benefits, accusing the IMF of making Pakistan a victim of a debt trap, like many other developing countries. In 2020–2021, the five COVID-19 pandemic waves in Pakistan and then the devastating flood in the country made the situation even more complicated. Challenges in the economy were aggravated by the fierce internal struggle of political opponents. The economic reforms carried out by the three subsequent governments in 2018–2022, headed by prime ministers Imran Khan, Shehbaz Sharif, and Anwaar Haq Kakar, were inconsistent and contradictory, which provoked criticism on the part of the IMF.

“Human capital”, “human potential” and labor law: The experience of an interdisciplinary approach

The article gives the author's analysis of the variety of approaches to the concept of "human capital", which has developed within the framework of economic science. Its positive characteristics, the possibility of using it to solve the problems of theory and practice related to labor law are noted. At the same time, the conventionality of this term, its ambiguity, and insufficient adaptation to legal realities are criticized. The concept of "human potential", its greater objectivity and correlation with empirical data, is assessed more positively. To confirm the author's position, the views on this issue of scientists-economists, both foreign (primarily G. Becker) and domestic, are considered. The article proposes the author's version of the relationship between the concepts of "human capital" and "human potential". The first refers to social spending or “investment in people” of budgetary funds at all levels and household funds. This funding is aimed at the development of education, obtaining professional skills, knowledge, skills, maintenance of employees during the period of disability, social support for families, housing, medical care, cultural development. This formulation of the question allows us to talk about the return on investment of "human capital", i.e. o the ratio of investments and subsequent income (negative, neutral or positive). It will still remain a metaphor (and the equivalence of investments and the return on them will always be relative), but not completely divorced from life. "Human potential", respectively, is considered as the potential ability of a person to realize himself, to participate in the economic life of society. It includes talent, moral and business qualities, education, professional knowledge, skills and abilities, as well as work experience, health status. This potential is not measured in rubles or another currency, but “human capital” is invested in it, relative to which the return is calculated. At the same time, doubts were expressed about the need to introduce "human capital" into the doctrine of labor law.

Responsivität im polarisierten Pluralismus – Teil 2: Die Rolle der Parteien

In empirical research on political representation, the congruence between the attitudes of voters and those elected is considered a good measure of political responsiveness . Using the example of four selected political orientations, this article examines the congruence between the preferences of the candidates nominated by the six parties represented in the Bundestag and the population for the election years 2009 to 2021 . Different findings emerge for the four attitudes . Across all parties, there are large similarities between the political preferences of voters and politicians . The positions of voters and politicians on the left-right scale and their attitudes towards climate protection are rather similar, while a more marked difference characterizes the attitudes towards controlling migration . The preference for higher social spending or tax cuts lies somewhere in between . The differences between the political con- victions of SPD and Linke voters and politicians are more pronounced than those of the other parties . In addition to party preference, the level of education has the strongest influ- ence on the distance between voters and politicians .

Social expenditure composition, inequality and growth in the OECD: Labour market policies are most effective

The literature on public social expenditure envisages a role for the composition of public social expenditure in the design of policies to reduce inequality and promote economic growth. However, there is a lack of empirical evidence on which to ground social policy decisions. This study contributes to filling this gap by investigating the dynamic interdependencies between nine different categories of social spending, inequality and growth in 36 OECD countries over the period 1995–2017. According to the results of our work, based on a PVAR model, achieving a decrease in inequality without decreasing output growth is possible, requiring a change in the composition of social policy that gives more weight to spending on old age and survivors’ pensions, incapacity and family benefits, and active labour market policies, the latter having also a positive impact on growth. On the contrary, social expenditure on housing, as it has been conducted, appears to harm growth and enhance inequality.

FUNCTIONS OF BICYCLE MOBILE APPLICATIONS IN THE ASPECT OF LOCAL AND REGIONAL TOURISM AND RECREATIONAL POLICY – AMISTAD CASE STUDY

Purpose. Identification of the functions performed by bicycle mobile applications for individual groups of recipients (stakeholders).Purpose. Identification of the functions performed by bicycle mobile applications for individual groups of recipients (stakeholders).Method. The article is based on the analysis of scientific literature on the subject, enriched by Internet sources, a case study and a comparative analysis of Amistad’s bicycle mobile applications, being their leading producer on the Polish market. Analysis has been carried out based on data from Google Play and App Store platforms, as well as information from the company’s website, observation of activities in the field of B2A2C marketing of this company, as well as a diagnostic survey and unstructured interviews with its head director.Results. A model of functions regarding cycling mobile applications for individual stakeholders and their typification was formulated. The reasons for the limited effectiveness of the interface and business functions of cycling mobile applications are their limited popularity caused by variation in the attractiveness of combining functions, the frequency of updates and the effectiveness of the application promotion system. The most important functions of bicycle mobile applications are related to the mechanisms of accelerating interaction and information flow: social and gamification features related to bicycle navigation.Research and conclusions limitations. Local governments and non-governmental organisations were not examined from the point of view of their perception concerning the functions of cycling mobile applications and effectiveness in their implementation.Practical implications. They refer to the process of designing bicycle mobile applications and creating shared value with their use. They can also contribute to increasing the rationality of public (social) spending allocated to the procurement of mobile applications.Originality. So far, no other in-depth studies on bicycle applications of Polish developers have been conducted.Type of paper. An article presenting the results of literature and empirical research.

OECD 개발원조위원회(DAC) 회원국의 성평등 원조 결정요인

Purpose: This study aims to empirically analyze the determinants of OECD/DAC member countries’ aid in support of gender equality aid as a principle objective(gender marker 2). Originality: International community has emphasized gender equality as a key principle and norm of development cooperation, and OECD/DAC has led international discussions and policy efforts on aid for gender equality. While discussions on gender and development has focused on normative and practical aspects, the motivation of donors’ commitments for gender equality has remained unanswered. To bridge this gap, this study empirically analyzes the determinants of OECD/DAC member countries’ aid in support of gender equality and draws upon policy implications. Methodology: Considering that the aid amount is panel data left-censored at zero, the panel Tobit model is used for the analysis. Result: It is found that the aid in support of gender equality increases as a recipient country’s gender needs increase; women’s representation in a donor country increases; a recipient country tends to have received more gender aids from OECD/DAC members; and the presence of women’s international NGOs increases in a donor country. Contrary to our hypothesis, however, the gender aid decreases as donor government increases social spending on family benefits. Conclusion and Implication: A strong humanitarian motivation was found behind the donor countries' aid support for gender equality, and thus it is important to provide good information on recipient countries’ gender needs. Also, international community’s efforts to make the gender equality an international norm need to keep continued as they have been successful in increasing donors’ commitments for the gender equality. In particular, the role of women’s international NGOs has to be shed more light on. Also, donor countries’ social values affects their commitments towards the gender equality overseas. The tension between domestic social expenditure on family benefits and supports for gender equality overseas requires further research and discussion in the future.

A Study on the Factors Influencing Household Consumption from a Money Demand Perspective: Evidence from Chinese Urban Residents

Based on the classic Keynesian theory of money demand and city panel data, in this study, we investigate the impacts of different money demand motives on urban household consumption in China, and provide ideas for promoting sustainable growth in household consumption in China. The results of this study show the following: First, in general, the theory of money demand motivation can adequately explain household consumption in large and medium-sized cities in China. Second, the CPI time series has a significant adverse effect on the real money demand of most households. Third, residents significantly reduce food consumption to satisfy speculative money demand for financial instruments, and the lower the income level, the keener households are to invest in high-risk stocks. Fourth, even for high-income households, the precautionary money demand generated via the purchase of commercial insurance still has a significant crowding-out effect on their total consumption. Social security spending, which reduces the precautionary money demand of households, has a much more positive impact on high-income households.

Time gap of the impact of risk insurance, life insurance and reinsurance on social progress: The case of Ukraine

The paper examines, using the example of Ukraine from 2003 to 2020, how and to what extent the development of various segments of the insurance market (risk insurance, life insurance, and reinsurance) influences the overall level of social progress. It also identifies the time gaps through which this influence manifests. The study creates a single measure that looks at various aspects such as social class differences, spending patterns, income changes, and government social spending (their standardized values, weighed by the principal component method, integrated through additive convolution). Using VAR modeling, the impact of the development indicators of different segments of the insurance market (risk insurance, life insurance, and reinsurance) at the current moment and with lags of one, two, and three years is investigated, as well as the level of social progress in Ukraine in previous years. The modeling confirms that social reforms yield significant results for social progress only after three years, similarly to the increase in the number of insurance companies. Given insurers’ assets and payout levels, their growth in life insurance has a faster impact on social progress than in risk, while the opposite is true for premiums. Insurance premiums transferred to Ukrainian reinsurers negatively and slowly (over three years) affect social progress, and to non-resident reinsurers – positively and faster (within a year). Across most indicators, life insurance not only influences Ukraine’s social progress more quickly than others but also provides a more substantial social effect.

Human development and inequalities: The importance of social public spending

In this article, we empirically analyse the impact of social public spending on human development distribution in a sample of 82 developed and developing countries over the period 2010–2021. Specifically, we focus on the impact of the three components of social spending (health, education and social protection) on the distribution of human development as measured by the Human Development Index (HDI) and its dimensions (health, education, and income). Applying data panel analysis, our empirical evidence shows that the three components of social expenditure reduce the loss of HDI caused by inequality. Hence, public resources allocated towards social spending have an important redistributive impact with regards to human development outcomes related to life expectancy, years of schooling and income per capita.

Does women's political empowerment matter in military spending?

AbstractDespite recognition of the importance of women's political rights for the functioning of modern states, women's participation in political debate and decision‐making remains low around the world. As the first study of its kind, this article examines the impact of women's political empowerment on military spending. Using a sample of 163 developed and developing countries, the article shows that women's political empowerment helps to reduce military spending. Moreover, this result remains robust when dealing with the level of development, endogeneity issues and geographical location. As an explanation, we highlight the role of women politically engaged in improving governance through the reduction of corruption, peacebuilding, their preference for social spending like education and health and their role in reduction discrimination against women.

The end of welfare states as we know them? A multidimensional perspective

AbstractThis article highlights the limitations of unidimensional analyses in the comparative welfare state literature and emphasises the need for a more holistic, multidimensional approach incorporating social spending, welfare state outputs and outcomes. To illustrate the utility of a multidimensional approach, we examine the long‐term welfare state trajectories of Sweden and Germany, prototypical social‐democratic and conservative welfare states, respectively, and compare them against the baseline of Europe's prototypical liberal welfare state, the United Kingdom. The social spending (expenditure) and output (generosity) allowed us to identify significant changes in the Swedish welfare state (i.e., retrenchment). The outcome dimension alerts us to a policy drift in the German Welfare State, as relatively stable public spending and welfare generosity until the first half of the 2000s were nonetheless associated with sharply increased inequality and poverty. Overall, our findings suggest that a holistic, multidimensional approach is necessary to fully understand the complexities of welfare state change and continuity, as focusing solely on one dimension can lead to analytical misjudgments. The sharp rise in inequality and poverty across countries raises doubts about whether policymakers and researchers rely too much on outdated assumptions of normality that fail to meet the welfare state realities of today.

Does Militarization Hinder Female Labor Income Share?

Abstract This study addresses the underexplored dimension of the relationship between military expenditures and gender inequality, drawing upon the insights of feminist security and international relations scholars. The influence of militarization on gender inequality is profound, manifesting itself significantly in both conflict and peacetime situations. The destruction of essential infrastructure further restricts women’s access to vital resources. In peacetime, the convergence of militarization and patriarchy reinforces women’s secondary roles in society, while higher military expenditures can divert resources from social spending, disproportionately affecting women and children reliant on public services. Despite extensive theoretical discussions, empirical studies on this nexus are limited. This paper contributes by presenting original evidence using a comprehensive dataset spanning 1991–2019, examining the Female Labor Income Share across over 100 countries. Findings reveal that militarization correlates with reduced the Female Labor Income Share, underscoring the urgency of addressing this critical linkage between militarization and gender inequality.

Corporate Social Responsibility along the global value chain

Locating substantial parts of the production process in developing and emerging economies, many firms face an increasing demand by stakeholders for Corporate Social Responsibility (CSR) along their value chains. Contractual incompleteness between firms and their suppliers at different stages of production can exacerbate the ability to meet these demands. We analyze a model of sequential production with incomplete contracts where CSR by independent suppliers differentiates the final product in the eyes of caring consumers. Progressing down the value chain, our model predicts an increasing CSR profile from upstream suppliers with low CSR to downstream suppliers with higher CSR. We confirm this prediction using Indian firm-level data – computing a firm’s value chain position by combining its product-level sales information with the World Input–Output Database. We find that more downstream firms report higher CSR expenditures as measured by a combination of staff welfare spending and social community spending.

The Effect of Government Expenditure in Education, Health and Social Assistance Spending on the Poverty Rate of Yogyakarta Special Region Province

This study has the final results to determine the relationship between government spending in education, health and social assistance spending on poverty rates in the Special Region of Yogyakarta. This secondary data-based research has the form of a time series in 2012-2021, then the method used is multiple linear regression analysis with the OLS (Ordinary Least Squares) method. The results showed that programs on education implemented by the government of the Special Region of Yogyakarta through variable government spending in education were right on target and able to reduce poverty. but, variable government spending on health has not been able to reduce poverty and social assistance spending will increase poverty due to the effects of government dependence.

Subventionen in Zeiten knapper Kassen

Abstract The decision of the Federal Constitutional Court to classify the transfer of €60 billion in unused coronavirus loan authorisations to the Climate and Transformation Fund as unconstitutional has plunged fiscal policy in Germany into a crisis. A “cash audit” is therefore called for. This article draws on the findings of the Kiel Subsidy Report. According to the budget plans for 2022 and 2023, federal financial aid is set to increase sharply. In 2023, they are expected to be even higher than the federal government’s social spending. Financial aid should therefore not be left out in order to counter-finance budget gaps.

The Economic Growth Factor in the Concept of Sustainable Reforms of National Pension Systems in the Eastern Europe Region

The international systems of indicators for the comparative assessment of the sustainability component do not always cover the Eastern European region, which can be considered an obstacle to the global understanding of the problems and possible solutions in the reform of national pension systems. At the same time, in the conditions when pension systems face the strong influence of several factors, and the operation and administration of national pension systems represent a challenge for most countries in the Eastern European region, it is important to determine the system of indicators, which would ensure a sustainable reform thereof. The article presents views on the systematization of the factors that influence the sustainable reforms of the national pension systems and the results of the study on the relationship between the factor of economic growth and the aging of the population, carried out for 10 countries in the Eastern European region and a chronological series 2010-2021. The data obtained on the correlation coefficient between economic growth and the rate of the elderly population confi rm recent research by other authors, carried out for 15 European countries during the same period, according to which the rate of the elderly population has a medium-level impact on economic growth for at least half of analyzed countries and for another third of countries there is no relationship between the economy and the 65+ population. The strength of the relationship between the economy and the elderly population in the period 2010-2021 was very weak in all countries in the Eastern European region. Moreover, in the Czech Republic and at the level of the region, this dependence could be considered as non-existent, the values of the correlation coefficients being close to 0. Only for Slovakia the correlation coefficient shows a slightly stronger but weak and opposite dependence, as for Belarus, Moldova and Russia. The author’s analysis does not validate the increasing burden of population aging in Eastern European economies, which means the lack of need to reorient public social spending towards higher age-related spending in the analyzed period. The study confirms the contradictory nature of the factor of raising the retirement age, thus, it could be removed from the list of beneficial factors of sustainable pension reform, and the cause-and-effect relationship between economic growth and the rate of the elderly population could be neglected. This study complements the data on the differences between Eastern European countries and Western and Northern European countries and would have an impact on policies to reform national pension systems, especially in the context of the political paradigm that supports the concept of a negative impact of aging on economic growth.

Social Spending and Long-term Economic Performance in the US

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.

Valuing high temperature's fiscal costs: Evidence from China

Developing effective climate governance policies requires a comprehensive understanding of climate change's costs. However, the existing literature investigates the impacts of climate change on the private sector but neglects to evaluate the fiscal costs. Using fiscal data from Chinese county governments and meteorological data from weather stations from 1995–2019, this paper empirically examines the impacts of climate change, represented by changes in extremely high temperatures, on fiscal sustainability. Our results document that extremely high temperatures significantly increase fiscal expenditure and fiscal balance pressures on local governments. Mechanistically, extremely high temperatures have increased public demand for social and health spending, forcing local governments to increase expenditure. This paper reveals the substantial climate risks embedded in the fiscal sector. Local governments should incorporate the fiscal cost of climate change into their decision-making frameworks when making fiscal decisions and recalculate the costs and benefits of mitigation and adaptation policies.

Adaptive social protection in Indonesia: Stress‐testing the effect of a natural disaster on poverty and vulnerability

AbstractIndonesia is among the countries with the highest exposure to natural disasters, and risks are expected to increase due to climate change. Natural disasters and other shocks require well‐developed social protection systems that can cushion the economic consequences for those most vulnerable to these events. International stakeholders advocate for ‘Adaptive Social Protection’ which links social policy with strategies on disaster risk reduction and climate change adaptation. This article uses the tax‐benefit microsimulation model INDOMOD to analyse the adaptiveness of the Indonesian social protection system by simulating an income shock caused by a natural disaster and testing reforms to the existing social protection system. We find that the existing system generally performs well in lifting people out of poverty in normal times but does not sufficiently help them to prepare for and cope with shocks. This is especially the case for large households, households with more than two children, people in their 20s and 80s and individuals with a disability. The tested hypothetical reforms reduce the impact of the shock and better target those identified as needing more support but require a substantial increase in social spending.