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An Empirical Analysis of the Dynamics of the Welfare State: The Case of Benefit Morale

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  • Halla, Martin

    ()
    (University of Linz)

  • Lackner, Mario

    ()
    (University of Linz)

  • Schneider, Friedrich

    ()
    (University of Linz)

Abstract

Does the supply of a welfare state create its own demand? Many economic scholars studying welfare arrangements refer to Say's law and insinuate a self-destructive welfare state. However, little is known about the empirical validity of these assumptions and hypotheses. We study the dynamic effect of different welfare arrangements on benefit fraud. In particular, we analyze the impact of the welfare state on the respective social norm, i.e. benefit morale. It turns out that a high level of public social expenditures and a high unemployment rate are associated with a small positive (or no) immediate impact on benefit morale, which however is crowded out by adverse medium and long run effects.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4165.

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Length: 29 pages
Date of creation: May 2009
Date of revision:
Handle: RePEc:iza:izadps:dp4165

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Keywords: welfare state; social norms; benefit fraud; benefit morale;

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References

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Citations

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Cited by:
  1. Michael Funke & Marc Gronwald, 2009. "A Convex Hull Approach to Counterfactual Analysis of Trade Openness and Growth," CESifo Working Paper Series 2692, CESifo Group Munich.
  2. Giacomo Corneo, 2011. "GINI DP 17: Income Inequality, Value Systems and Macroeconomic Performance," GINI Discussion Papers 17, AIAS, Amsterdam Institute for Advanced Labour Studies.
  3. Martin Halla, 2010. "The Link between the Intrinsic Motivation to Comply and Compliance Behavior – A Critical Appraisal of Existing Evidence," Economics working papers 2010-03, Department of Economics, Johannes Kepler University Linz, Austria.
  4. Friedrich Heinemann, 2011. "Economic crisis and morale," European Journal of Law and Economics, Springer, vol. 32(1), pages 35-49, August.
  5. Corneo, Giacomo & Neher, Frank, 2012. "Income Inequality and Self-Reported Values," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 382, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
  6. repec:aia:ginidp:dp17 is not listed on IDEAS
  7. Daniel Arnold, 2012. "Benefit Morale and Cross-Country Diversity in Sick Pay Entitlements," IAAEU Discussion Papers 201211, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).
  8. Chadi, Adrian, 2011. "Employed but still unhappy? On the relevance of the social work norm," CAWM Discussion Papers 42, Center of Applied Economic Research Münster (CAWM), University of Münster.
  9. Schnellenbach, Jan & Schubert, Christian, 2014. "Behavioral public choice: A survey," Freiburg Discussion Papers on Constitutional Economics 14/03, Walter Eucken Institut e.V..

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