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Explaining Welfare State Survival: The Role of Economic Freedom and Globalization

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Abstract

Using the economic freedom index and the newly developed KOF-index of globalization, it is shown that the Scandinavian welfare states have experienced faster, bigger and more consistent increases in these areas, compared to the smaller European and the so called liberal welfare states. The market economy and globalization hence do not pose threats to these welfare states, but are instead neglected factors in explaining their survival and good economic performance. Big government decreases the economic freedom index by definition, but the welfare states compensate in other areas, such as legal structure and secure property rights.

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  • Bergh, Andreas, 2006. "Explaining Welfare State Survival: The Role of Economic Freedom and Globalization," Ratio Working Papers 101, The Ratio Institute.
  • Handle: RePEc:hhs:ratioi:0101
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    References listed on IDEAS

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    Cited by:

    1. Christian Bjørnskov & Axel Dreher & Justina Fischer, 2008. "Cross-country determinants of life satisfaction: exploring different determinants across groups in society," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 30(1), pages 119-173, January.
    2. 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.
    3. Berthold, Norbert & Brunner, Alexander, 2007. "Gibt es ein europäisches Sozialmodell?," Discussion Paper Series 100, Julius Maximilian University of Würzburg, Chair of Economic Order and Social Policy.
    4. repec:khe:scajes:v:3:y:2017:i:2:p:76-87 is not listed on IDEAS
    5. Alexander Brunner & Norbert Berthold, 2008. "The Struggle Between Equity and Efficiency: Do Nordic Countries Have a Free Lunch?," LIS Working papers 498, LIS Cross-National Data Center in Luxembourg.

    More about this item

    Keywords

    Welfare state; growth; property rights; globalization; taxation; economic freedom;

    JEL classification:

    • F02 - International Economics - - General - - - International Economic Order and Integration
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • P48 - Economic Systems - - Other Economic Systems - - - Political Economy; Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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