IDEAS home Printed from https://ideas.repec.org/a/kap/pubcho/v153y2012i3p393-418.html
   My bibliography  Save this article

Is German domestic social policy politically controversial?

Author

Listed:
  • Niklas Potrafke

    ()

Abstract

This paper investigates empirically the influence of government ideology on social policy using German data. Examining the funding and the benefits of social security and public healthcare policy, my results suggest that policies implemented by governments dominated by left- and rightwing parties were similar over the 1951–2007 period. Leftwing governments, however, spent more in the 1970s and rightwing governments did so after German Reunification in 1990. Since policy convergence encourages new parties to enter the political arena, and party platforms on social policy matters are likely to undergo further changes in light of demographic change, the observed pattern may thus be a transitory phenomenon. Copyright Springer Science+Business Media, LLC 2012

Suggested Citation

  • Niklas Potrafke, 2012. "Is German domestic social policy politically controversial?," Public Choice, Springer, vol. 153(3), pages 393-418, December.
  • Handle: RePEc:kap:pubcho:v:153:y:2012:i:3:p:393-418
    DOI: 10.1007/s11127-011-9800-4
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s11127-011-9800-4
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Congleton, Roger D & Shughart, William F, II, 1990. "The Growth of Social Security: Electoral Push or Political Pull?," Economic Inquiry, Western Economic Association International, vol. 28(1), pages 109-132, January.
    2. Gohlmann, Silja & Vaubel, Roland, 2007. "The educational and occupational background of central bankers and its effect on inflation: An empirical analysis," European Economic Review, Elsevier, vol. 51(4), pages 925-941, May.
    3. Brender, Adi & Drazen, Allan, 2005. "Political budget cycles in new versus established democracies," Journal of Monetary Economics, Elsevier, vol. 52(7), pages 1271-1295, October.
    4. Niklas Potrafke, 2011. "Public Expenditures on Education and Cultural Affairs in the West German States: Does Government Ideology Influence the Budget Composition?," German Economic Review, Verein für Socialpolitik, vol. 12(1), pages 124-145, February.
    5. Potrafke, Niklas, 2010. "The growth of public health expenditures in OECD countries: Do government ideology and electoral motives matter?," Journal of Health Economics, Elsevier, vol. 29(6), pages 797-810, December.
    6. Cutler, David & Johnson, Richard, 2004. "The Birth and Growth of the Social Insurance State: Explaining Old-Age and Medical Insurance Across Countries," Scholarly Articles 2643658, Harvard University Department of Economics.
    7. Irem Batool & Gernot Sieg, 2009. "Bread and the attrition of power: Economic events and German election results," Public Choice, Springer, vol. 141(1), pages 151-165, October.
    8. repec:cup:apsrev:v:71:y:1977:i:04:p:1467-1487_26 is not listed on IDEAS
    9. Benoît Maux & Yvon Rocaboy & Timothy Goodspeed, 2011. "Political fragmentation, party ideology and public expenditures," Public Choice, Springer, vol. 147(1), pages 43-67, April.
    10. Kevin Grier, 2008. "US presidential elections and real GDP growth, 1961–2004," Public Choice, Springer, vol. 135(3), pages 337-352, June.
    11. Axel Dreher & Jan-Egbert Sturm & Heinrich Ursprung, 2008. "The impact of globalization on the composition of government expenditures: Evidence from panel data," Public Choice, Springer, vol. 134(3), pages 263-292, March.
    12. Saikkonen, Pentti & L tkepohl, Helmut, 2002. "Testing For A Unit Root In A Time Series With A Level Shift At Unknown Time," Econometric Theory, Cambridge University Press, vol. 18(02), pages 313-348, April.
    13. Shi, Min & Svensson, Jakob, 2006. "Political budget cycles: Do they differ across countries and why?," Journal of Public Economics, Elsevier, vol. 90(8-9), pages 1367-1389, September.
    14. Breyer, Friedrich, 1994. "The political economy of intergenerational redistribution," European Journal of Political Economy, Elsevier, vol. 10(1), pages 61-84, May.
    15. Breyer Friedrich & Ulrich Volker, 2000. "Gesundheitsausgaben, Alter und medizinischer Fortschritt: Eine Regressionsanalyse / Ageing, Medical Progress and Health Care Expenditures: A Regression Analysis," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 220(1), pages 1-17, February.
    16. Alesina, Alberto & Rosenthal, Howard, 1996. "A Theory of Divided Government," Econometrica, Econometric Society, vol. 64(6), pages 1311-1341, November.
    17. Seitz, Helmut, 2000. "Fiscal Policy, Deficits and Politics of Subnational Governments: The Case of the German Laender," Public Choice, Springer, vol. 102(3-4), pages 183-218, March.
    18. Belke, Ansgar, 2000. "Partisan Political Business Cycles in the German Labour Market? Empirical Tests in the Light of the Lucas-Critique," Public Choice, Springer, vol. 104(3-4), pages 225-283, September.
    19. Kenneth Rogoff & Anne Sibert, 1988. "Elections and Macroeconomic Policy Cycles," Review of Economic Studies, Oxford University Press, vol. 55(1), pages 1-16.
    20. David M. Cutler & Richard Johnson, 2004. "The Birth and Growth of the Social Insurance State: Explaining Old Age and Medical Insurance Across Countries," Public Choice, Springer, vol. 120(1_2), pages 87-121, July.
    21. Toke Aidt & Francisco Veiga & Linda Veiga, 2011. "Election results and opportunistic policies: A new test of the rational political business cycle model," Public Choice, Springer, vol. 148(1), pages 21-44, July.
    22. Mark Mink & Jakob de Haan, 2006. "Are there Political Budget Cycles in the Euro Area?," European Union Politics, , vol. 7(2), pages 191-211, June.
    23. Alberto Alesina, 1987. "Macroeconomic Policy in a Two-Party System as a Repeated Game," The Quarterly Journal of Economics, Oxford University Press, vol. 102(3), pages 651-678.
    24. repec:cup:apsrev:v:72:y:1978:i:04:p:1243-1261_15 is not listed on IDEAS
    25. Kemmerling, Achim & Neugart, Michael, 2009. "Financial market lobbies and pension reform," European Journal of Political Economy, Elsevier, vol. 25(2), pages 163-173, June.
    26. Rogoff, Kenneth, 1990. "Equilibrium Political Budget Cycles," American Economic Review, American Economic Association, vol. 80(1), pages 21-36, March.
    27. Berger, Helge & Woitek, Ulrich, 2001. "The German political business cycle: money demand rather than monetary policy," European Journal of Political Economy, Elsevier, vol. 17(3), pages 609-631, September.
    28. Berger, Helge & Woitek, Ulrich, 1997. "How opportunistic are partisan German central bankers: Evidence on the Vaubel hypothesis," European Journal of Political Economy, Elsevier, vol. 13(4), pages 807-821, December.
    29. Axel Dreher, 2006. "Does globalization affect growth? Evidence from a new index of globalization," Applied Economics, Taylor & Francis Journals, vol. 38(10), pages 1091-1110.
    30. Roland Füss & Michael Bechtel, 2008. "Partisan politics and stock market performance: The effect of expected government partisanship on stock returns in the 2002 German federal election," Public Choice, Springer, vol. 135(3), pages 131-150, June.
    31. Göhlmann, Silja & Vaubel, Roland, 2005. "The Educational and Professional Background of Central Bankers and its Effect on Inflation - An Empirical Analysis," RWI Discussion Papers 25, RWI - Leibniz-Institut für Wirtschaftsforschung.
    32. Christina Schneider, 2010. "Fighting with one hand tied behind the back: political budget cycles in the West German states," Public Choice, Springer, vol. 142(1), pages 125-150, January.
    33. Lanne, Markku & Lütkepohl, Helmut & Saikkonen, Pentti, 1999. "Comparison of unit root tests for time series with level shifts," SFB 373 Discussion Papers 1999,88, Humboldt University of Berlin, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes.
    34. repec:cup:apsrev:v:95:y:2001:i:04:p:859-874_40 is not listed on IDEAS
    35. Vaubel, Roland, 1997. "The bureaucratic and partisan behavior of independent central banks: German and international evidence," European Journal of Political Economy, Elsevier, vol. 13(2), pages 201-224, May.
    36. Michael M. Bechtel & Roland Füss, 2010. "Capitalizing on Partisan Politics? The Political Economy of Sector-Specific Redistribution in Germany," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 42(2-3), pages 203-235, March.
    37. Ansgar Belke & Frank Baumgärtner & Friedrich Schneider & Ralph Setzer, 2007. "The Different Extent of Privatization Proceeds in OECD Countries: A Preliminary Explanation Using a Public-Choice Approach," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 63(2), pages 211-243, June.
    38. Günther G. Schulze & Heinrich W. Ursprung, 1999. "Globalisation of the Economy and the Nation State," The World Economy, Wiley Blackwell, vol. 22(3), pages 295-352, May.
    39. Bjørnskov, Christian, 2008. "The growth-inequality association: Government ideology matters," Journal of Development Economics, Elsevier, vol. 87(2), pages 300-308, October.
    40. Bodea, Cristina, 2010. "The political economy of fixed exchange rate regimes: The experience of post-communist countries," European Journal of Political Economy, Elsevier, vol. 26(2), pages 248-264, June.
    41. repec:hrv:faseco:34222831 is not listed on IDEAS
    42. Jensen, Carsten, 2011. "Marketization via Compensation: Health Care and the Politics of the Right in Advanced Industrialized Nations," British Journal of Political Science, Cambridge University Press, vol. 41(04), pages 907-926, October.
    43. Niklas Potrafke, 2009. "Did globalization restrict partisan politics? An empirical evaluation of social expenditures in a panel of OECD countries," Public Choice, Springer, vol. 140(1), pages 105-124, July.
    44. Cusack, Thomas R, 1997. "Partisan Politics and Public Finance: Changes in Public Spending in the Industrialized Democracies, 1955-1989," Public Choice, Springer, vol. 91(3-4), pages 375-395, June.
    45. Vaubel, Roland, 1997. "Reply to Berger and Woitek," European Journal of Political Economy, Elsevier, vol. 13(4), pages 823-827, December.
    46. repec:cup:apsrev:v:95:y:2001:i:04:p:875-893_40 is not listed on IDEAS
    47. De Donder, Philippe & Hindriks, Jean, 2007. "Equilibrium social insurance with policy-motivated parties," European Journal of Political Economy, Elsevier, vol. 23(3), pages 624-640, September.
    48. Roger Congleton & Feler Bose, 2010. "The rise of the modern welfare state, ideology, institutions and income security: analysis and evidence," Public Choice, Springer, vol. 144(3), pages 535-555, September.
    49. Tepe, Markus & Vanhuysse, Pieter, 2009. "Are Aging OECD Welfare States on the Path to Gerontocracy?," Journal of Public Policy, Cambridge University Press, vol. 29(01), pages 1-28, April.
    50. Perron, Pierre, 1990. "Testing for a Unit Root in a Time Series with a Changing Mean," Journal of Business & Economic Statistics, American Statistical Association, vol. 8(2), pages 153-162, April.
    51. Alesina, Alberto, 1987. "Macroeconomic Policy in a Two-party System as a Repeated Game," Scholarly Articles 4552531, Harvard University Department of Economics.
    52. Gemmell, Norman & Kneller, Richard & Sanz, Ismael, 2008. "Foreign investment, international trade and the size and structure of public expenditures," European Journal of Political Economy, Elsevier, vol. 24(1), pages 151-171, March.
    53. repec:zbw:rwidps:0025 is not listed on IDEAS
    54. Galasso, Vincenzo & Profeta, Paola, 2002. "The political economy of social security: a survey," European Journal of Political Economy, Elsevier, vol. 18(1), pages 1-29, March.
    55. Ulrich Oberndorfer & Viktor Steiner, 2007. "Generationen- oder Parteienkonflikt? Eine empirische Analyse der deutschen Hochschulausgaben," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 8(2), pages 165-183, March.
    56. William D. Nordhaus, 1975. "The Political Business Cycle," Review of Economic Studies, Oxford University Press, vol. 42(2), pages 169-190.
    57. Berger, Helge & Woitek, Ulrich, 1997. "Searching for Political Business Cycles in Germany," Public Choice, Springer, vol. 91(2), pages 179-197, April.
    58. Helmut Seitz, 2008. "Die Bundesbestimmtheit der Länderausgaben," Wirtschaftsdienst, Springer;German National Library of Economics, vol. 88(5), pages 340-348, May.
    59. Helge Berger & Ulrich Woitek, 2005. "Does Conservatism Matter? A Time-Series Approach to Central Bank Behaviour," Economic Journal, Royal Economic Society, vol. 115(505), pages 745-766, July.
    60. Galli, Emma & Rossi, Stefania P S, 2002. "Political Budget Cycles: The Case of the Western German Lander," Public Choice, Springer, vol. 110(3-4), pages 283-303, March.
    61. Bethencourt, Carlos & Galasso, Vincenzo, 2008. "Political complements in the welfare state: Health care and social security," Journal of Public Economics, Elsevier, vol. 92(3-4), pages 609-632, April.
    62. Kittel, Bernhard & Obinger, Herbert, 2002. "Political parties, institutions, and the dynamics of social expenditure in times of austerity," MPIfG Discussion Paper 02/1, Max Planck Institute for the Study of Societies.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Niklas Potrafke, 2013. "Economic Freedom and Government Ideology across the German States," Regional Studies, Taylor & Francis Journals, vol. 47(3), pages 433-449, March.
    2. Mario Mechtel & Niklas Potrafke, 2013. "Electoral cycles in active labor market policies," Public Choice, Springer, vol. 156(1), pages 181-194, July.
    3. Niklas Potrafke & Markus Reischmann & Marina Riem & Christoph Schinke & David Streich, 2014. "Wirtschaftslage und Regierungsideologie in Europa," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 67(09), pages 18-25, May.
    4. Krumm, Raimund & Volkert, Jürgen, 2015. "Möglichkeiten und Grenzen der politischen Realisierbarkeit intra- und intergenerativer Gerechtigkeit," UFZ Discussion Papers 11/2015, Helmholtz Centre for Environmental Research (UFZ), Division of Social Sciences (ÖKUS).
    5. Ade, Florian & Freier, Ronny & Odendahl, Christian, 2014. "Incumbency effects in government and opposition: Evidence from Germany," European Journal of Political Economy, Elsevier, vol. 36(C), pages 117-134.
    6. Björn Kauder & Niklas Potrafke, 2013. "Government Ideology and Tuition Fee Policy: Evidence from the German States," CESifo Economic Studies, CESifo, vol. 59(4), pages 628-649, December.
    7. Niklas Potrafke & Marina Riem & Christoph Schinke, 2016. "Debt Brakes in the German States: Governments’ Rhetoric and Actions," German Economic Review, Verein für Socialpolitik, vol. 17(2), pages 253-275, May.
    8. Reischmann Markus, 2014. "Staatsverschuldung in Extrahaushalten: Historischer Überblick und Implikationen für die Schuldenbremse in Deutschland," Perspektiven der Wirtschaftspolitik, De Gruyter, vol. 15(2), pages 171-181, June.
    9. Niklas Potrafke, 2013. "Evidence on the political principal-agent problem from voting on public finance for concert halls," Constitutional Political Economy, Springer, vol. 24(3), pages 215-238, September.
    10. Björn Kauder & Benjamin Larin & Niklas Potrafke, 2014. "Was bringt uns die große Koalition? Perspektiven der Wirtschaftspolitik," ifo Working Paper Series 172, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    11. Axel Dreher & Peter Nunnenkamp & Maya Schmaljohann, 2015. "The Allocation of German Aid: Self-interest and Government Ideology," Economics and Politics, Wiley Blackwell, vol. 27(1), pages 160-184, March.
    12. Ade, Florian & Freier, Ronny, 2013. "Divided government versus incumbency externality effect—Quasi-experimental evidence on multiple voting decisions," European Economic Review, Elsevier, vol. 64(C), pages 1-20.
    13. Björn Kauder, 2016. "Incorporation of municipalities and population growth: A propensity score matching approach," Papers in Regional Science, Wiley Blackwell, vol. 95(3), pages 539-554, August.
    14. Björn Kauder & Niklas Potrafke & Simone Winterer, 2015. "Das Wachstum der Verteidigungsausgaben in Deutschland (1951-2011): Welchen Einfluss haben die Parteien?," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 68(10), pages 19-26, May.
    15. Manuela Krause & Niklas Potrafke, 2017. "The Real Estate Transfer Tax and Government Ideology: Evidence from the German States," CESifo Working Paper Series 6491, CESifo Group Munich.
    16. Björn Kauder & Manuela Krause & Niklas Potrafke, 2016. "Electoral Cycles in MPs' Salaries: Evidence from the German States," CESifo Working Paper Series 6028, CESifo Group Munich.
    17. Björn Kauder, 2015. "Spatial Administrative Structure And Intra-Metropolitan Tax Competition," Journal of Regional Science, Wiley Blackwell, vol. 55(4), pages 626-643, September.
    18. Patrick Laurency & Dirk Schindler, 2011. "International Climate Agreements, Cost Reductions and Convergence of Partisan Politics," CESifo Working Paper Series 3591, CESifo Group Munich.
    19. Freier, Ronny, 2015. "The mayor's advantage: Causal evidence on incumbency effects in German mayoral elections," European Journal of Political Economy, Elsevier, vol. 40(PA), pages 16-30.
    20. repec:ces:ifosdt:v:70:y:2017:i:20:p:28-37 is not listed on IDEAS
    21. Björn Kauder & Niklas Potrafke, 2013. "Regierungsideologie und Studiengebühren in den deutschen Bundesländern," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 66(10), pages 19-24, May.

    More about this item

    Keywords

    Social policy; Political business and partisan cycles; Government ideology; Policy polarization; Demographic change; H52; H55; I38; J18; D72;

    JEL classification:

    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:pubcho:v:153:y:2012:i:3:p:393-418. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla) or (Rebekah McClure). General contact details of provider: http://www.springer.com .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.