IDEAS home Printed from https://ideas.repec.org/p/hal/cesptp/halshs-00176295.html
   My bibliography  Save this paper

Welfare-State Retrenchment: The Partisan Effect Revisited

Author

Listed:
  • Bruno Amable

    (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)

  • Donatella Gatti

    (CEPN - Centre d'Economie de l'Université Paris Nord (ancienne affiliation) - UP13 - Université Paris 13 - CNRS - Centre National de la Recherche Scientifique, PJSE - Paris-Jourdan Sciences Economiques - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique)

  • Jan Schumacher

    (Department of Economics - UR - Universität Regensburg)

Abstract

This paper aims to shed light on the role of the 'ideology'of political parties in shaping the evolution of the welfare state in 18 developed democracies, by providing empirical ...ndings on the determinants of social programs entitlements and social spending over the period 1981-1999. The paper shows that structural change is a major determinant of the extent of social protection. Our results suggest that overall spending is driven up by structural change. On the other hand, strong structural change has a negative influence on welfare entitlements measured by the net rate of sickness insurance. Partisan influence plays an important role in the dynamics of the welfare state. Left-wing governments strengthen the positive effect of shocks on aggregate social expenditure while right-wing governments undertake even stronger cutbacks in replacement rates as a reaction to structural change.

Suggested Citation

  • Bruno Amable & Donatella Gatti & Jan Schumacher, 2006. "Welfare-State Retrenchment: The Partisan Effect Revisited," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00176295, HAL.
    • Handle: RePEc:hal:cesptp:halshs-00176295
    DOI: 10.1093/oxrep/grj025
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Torsten Persson, 2002. "Do Political Institutions Shape Economic Policy?," Econometrica, Econometric Society, vol. 70(3), pages 883-905, May.
    2. Tito Boeri & Giuseppe Nicoletti & Stefano Scarpetta, "undated". "Regulation and Labour Market Performance," Working Papers 158, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    3. Torben M. Andersen, "undated". "International Integration and the Welfare State," Economics Working Papers 2002-2, Department of Economics and Business Economics, Aarhus University.
    4. Andersen, Torben M., 2002. "International Integration, Risk and the Welfare State," IZA Discussion Papers 456, Institute of Labor Economics (IZA).
    5. Abraham, Katharine G & Katz, Lawrence F, 1986. "Cyclical Unemployment: Sectoral Shifts or Aggregate Disturbances?," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages 507-522, June.
    6. Blanchard, Olivier & Wolfers, Justin, 2000. "The Role of Shocks and Institutions in the Rise of European Unemployment: The Aggregate Evidence," Economic Journal, Royal Economic Society, vol. 110(462), pages 1-33, March.
    7. Nicola Persico & Alessandro Lizzeri, 2001. "The Provision of Public Goods under Alternative Electoral Incentives," American Economic Review, American Economic Association, vol. 91(1), pages 225-239, March.
    8. Nickell, Stephen & Layard, Richard, 1999. "Labor market institutions and economic performance," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 46, pages 3029-3084, Elsevier.
    9. Torsten Persson & Gerard Roland & Guido Tabellini, 2003. "How Do Electoral Rules Shape Party Structures, Government Coalitions and Economic Policies?," Working Papers 251, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    10. Braumoeller, Bear F., 2004. "Hypothesis Testing and Multiplicative Interaction Terms," International Organization, Cambridge University Press, vol. 58(4), pages 807-820, October.
    11. Dani Rodrik, 1998. "Why Do More Open Economies Have Bigger Governments?," Journal of Political Economy, University of Chicago Press, vol. 106(5), pages 997-1032, October.
    12. Persson, Torsten & Tabellini, Guido, 1999. "Political economics and macroeconomic policy," Handbook of Macroeconomics, in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 22, pages 1397-1482, Elsevier.
    13. Victor R. Fuchs, 1996. "Individual and Social Responsibility: Child Care, Education, Medical Care, and Long-Term Care in America," NBER Books, National Bureau of Economic Research, Inc, number fuch96-1.
    14. Beck, Nathaniel & Katz, Jonathan N., 1995. "What To Do (and Not to Do) with Time-Series Cross-Section Data," American Political Science Review, Cambridge University Press, vol. 89(3), pages 634-647, September.
    15. Persson, Torsten & Tabellini, Guido, 1999. "The size and scope of government:: Comparative politics with rational politicians," European Economic Review, Elsevier, vol. 43(4-6), pages 699-735, April.
    16. Cameron, David R., 1978. "The Expansion of the Public Economy: A Comparative Analysis," American Political Science Review, Cambridge University Press, vol. 72(4), pages 1243-1261, December.
    17. Amable, Bruno, 2003. "The Diversity of Modern Capitalism," OUP Catalogue, Oxford University Press, number 9780199261147.
    18. Gian Maria Milesi-Ferretti & Roberto Perotti & Massimo Rostagno, 2002. "Electoral Systems and Public Spending," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 117(2), pages 609-657.
    19. Korpi, Walter & Palme, Joakim, 2003. "New Politics and Class Politics in the Context of Austerity and Globalization: Welfare State Regress in 18 Countries, 1975–95," American Political Science Review, Cambridge University Press, vol. 97(3), pages 425-446, August.
    20. Paul M. Romer, 1996. "Preferences, Promises, and the Politics of Entitlement," NBER Chapters, in: Individual and Social Responsibility: Child Care, Education, Medical Care, and Long-Term Care in America, pages 195-228, National Bureau of Economic Research, Inc.
    21. James P. Allan & Lyle Scruggs, 2004. "Political Partisanship and Welfare State Reform in Advanced Industrial Societies," American Journal of Political Science, John Wiley & Sons, vol. 48(3), pages 496-512, July.
    22. Fuchs, Victor R. (ed.), 1996. "Individual and Social Responsibility," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226267869, April.
    23. Moene, Karl Ove & Wallerstein, Michael, 2001. "Inequality, Social Insurance, and Redistribution," American Political Science Review, Cambridge University Press, vol. 95(4), pages 859-874, December.
    24. Lilien, David M, 1982. "Sectoral Shifts and Cyclical Unemployment," Journal of Political Economy, University of Chicago Press, vol. 90(4), pages 777-793, August.
    25. Torben M. Andersen, 2003. "European integration and the welfare state," Journal of Population Economics, Springer;European Society for Population Economics, vol. 16(1), pages 1-19, February.
    26. Amable, Bruno & Gatti, Donatella, 2004. "The Political Economy of Job Protection and Income Redistribution," IZA Discussion Papers 1404, Institute of Labor Economics (IZA).
    27. Torben M. Andersen, 2002. "International Integration, Risk and the Welfare State," Scandinavian Journal of Economics, Wiley Blackwell, vol. 104(3), pages 343-364, September.
    28. Alberto Alesina & Edward Glaeser & Bruce Sacerdote, 2001. "Why Doesn't The US Have a European-Style Welfare State?," Harvard Institute of Economic Research Working Papers 1933, Harvard - Institute of Economic Research.
    29. Fernandez, Raquel & Rodrik, Dani, 1991. "Resistance to Reform: Status Quo Bias in the Presence of Individual-Specific Uncertainty," American Economic Review, American Economic Association, vol. 81(5), pages 1146-1155, December.
    30. A. B. Atkinson, 1999. "The Economic Consequences of Rolling Back the Welfare State," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262011719, April.
    31. Alesina, Alberto & Wacziarg, Romain, 1998. "Openness, country size and government," Journal of Public Economics, Elsevier, vol. 69(3), pages 305-321, September.
    32. Alberto Alesina & Edward Glaeser & Bruce Sacerdote, 2001. "Why Doesn't the US Have a European-Style Welfare System?," NBER Working Papers 8524, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Amable, Bruno & Gatti, Donatella, 2004. "The Political Economy of Job Protection and Income Redistribution," IZA Discussion Papers 1404, Institute of Labor Economics (IZA).
    2. Alberto Alesina & Edward Glaeser & Bruce Sacerdote, 2001. "Why Doesn't The US Have a European-Style Welfare State?," Harvard Institute of Economic Research Working Papers 1933, Harvard - Institute of Economic Research.
    3. Alberto Alesina & Edward Glaeser & Bruce Sacerdote, 2001. "Why Doesn't the US Have a European-Style Welfare System?," NBER Working Papers 8524, National Bureau of Economic Research, Inc.
    4. Indra de Soysa & Jennifer Bailey & Eric Neumayer, 2004. "Free to Squander? Democracy, Institutional Design, and Economic Sustainability, 1975–2000," Macroeconomics 0412004, University Library of Munich, Germany.
    5. Bruno Amable & Donatella Gatti & Elvire Guillaud, 2008. "How does Party Fractionalization convey Preferences for Redistribution in Parliamentary Democracies?," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00348878, HAL.
    6. Persson, Torsten & Roland, Gerard & Tabellini, Guido, 2007. "Electoral Rules and Government Spending in Parliamentary Democracies," Quarterly Journal of Political Science, now publishers, vol. 2(2), pages 155-188, May.
    7. Jonas Agell, 2002. "On the Determinants of Labour Market Institutions: Rent Seeking vs. Social Insurance," German Economic Review, Verein für Socialpolitik, vol. 3(2), pages 107-135, May.
    8. Bruno Amable & Donatella Gatti & Elvire Guillaud, 2008. "How does party fractionalization convey preferences for redistribution in parliamentary democracies?," CEPN Working Papers halshs-00586259, HAL.
    9. Abu S. Shonchoy, 2016. "Political Institutions, Governance, And Consumption Expenditure In Developing Countries: A Panel Data Analysis," Contemporary Economic Policy, Western Economic Association International, vol. 34(4), pages 710-728, October.
    10. Mr. Anthony M Annett, 2002. "Politics, Government Size, and Fiscal Adjustment in Industrial Countries," IMF Working Papers 2002/162, International Monetary Fund.
    11. Persson, Torsten & Tabellini, Guido, 2002. "Political economics and public finance," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 3, chapter 24, pages 1549-1659, Elsevier.
    12. Alberto Alesina & Edward Glaeser & Bruce Sacerdote, 2001. "Why Doesn't the United States Have a European-Style Welfare State?," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 32(2), pages 187-278.
    13. Florian Haelg & Niklas Potrafke & Jan-Egbert Sturm, 2022. "The determinants of social expenditures in OECD countries," Public Choice, Springer, vol. 193(3), pages 233-261, December.
    14. Chen, Yu-Fu & Görg, Holger & Görlich, Dennis & Molana, Hassan & Montagna, Catia & Temouri, Yama, 2014. "Globalisation and the Future of the Welfare State," IZA Policy Papers 81, Institute of Labor Economics (IZA).
    15. Philippe Aghion & Alberto Alesina & Francesco Trebbi, 2004. "Endogenous Political Institutions," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(2), pages 565-611.
    16. Shelton, Cameron A., 2007. "The size and composition of government expenditure," Journal of Public Economics, Elsevier, vol. 91(11-12), pages 2230-2260, December.
    17. Ignacio Lago-Peñas & Santiago Lago-Peñas, 2009. "Does the nationalization of party systems affect the composition of public spending?," Economics of Governance, Springer, vol. 10(1), pages 85-98, January.
    18. Shelton, Cameron A., 2008. "The aging population and the size of the welfare state: Is there a puzzle?," Journal of Public Economics, Elsevier, vol. 92(3-4), pages 647-651, April.
    19. Jonas Agell, 2000. "On the Determinants of Labour Market Institutions: Rent-Sharing vs. Social Insurance," CESifo Working Paper Series 384, CESifo.
    20. Andros Kourtellos & Alex Lenkoski & Kyriakos Petrou, 2017. "Measuring the Strength of the Theories of Government Size," University of Cyprus Working Papers in Economics 11-2017, University of Cyprus Department of Economics.

    More about this item

    Keywords

    Welfare State; ideology; structural change;
    All these keywords.

    JEL classification:

    • H5 - Public Economics - - National Government Expenditures and Related Policies
    • I1 - Health, Education, and Welfare - - Health
    • J8 - Labor and Demographic Economics - - Labor Standards

    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:hal:cesptp:halshs-00176295. See general information about how to correct material in RePEc.

    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 bibliographic 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.