Globalization and social spending
AbstractWe provide evidence indicating that countries with well developed social security systems do not necessarily face a trade-off between social spending and competitiveness. On average, countries that spend a lot on social needs score well in the competitiveness league. We investigate the importance of a reverse causality from competitiveness to social spending, and find that this is weak. We also present some possible explanations for our empirical finding. Finally, we interpret our findings in the framework of a theoretical model in which risk affects the size of the social sector and social spending affects the production function of the private sector.
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Bibliographic InfoPaper provided by Katholieke Universiteit Leuven in its series Open Access publications from Katholieke Universiteit Leuven with number urn:hdl:123456789/100866.
Date of creation: Feb 2005
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Publication status: Published in Pacific economic review (2005-02) v.10, p.105-123
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Web page: http://www.kuleuven.be
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- repec:sae:jocore:v:54:y:2010:i:6:p:902-939 is not listed on IDEAS
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