The Future of the Welfare State: Crisis Myths and Crisis Realities

Abstract

This book uses data from 21 OECD countries for the period 1980 to 1998 to test a variety of hypotheses suggesting that contemporary welfare states are in crisis and to establish the factors shaping the trajectory of welfare state development during these years. It assesses the validity of arguments that globalization leads to a ‘race to the bottom’ in social spending and that population ageing poses a threat to public budgets. It finds both of these arguments wanting and, instead, suggests that contemporary welfare states have been converging to a steady state over recent decades. The book also examines the extent to which welfare states across the OECD have been restructured in recent years and whether there are signs of the emergence of a distinctive European ‘social model’. Again, it finds that accounts of substantial welfare state restructuring and of the Europeanization of the welfare state are much exaggerated. Finally, the book identifies a potential threat to the viability of existing societies in a trend to declining fertility throughout the advanced world, but argues that the welfare state in the form of family-friendly policy is actually our best protection against this trend.