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The Convergence of Welfare State Indicators in Europe: Evidence from Panel Data

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  • Paetzold, Jörg

    () (University of Salzburg)

Abstract

This paper investigates whether there is a convergence in welfare state policies among the old EU member states. To identify such trends, we rely on pension and unemployment net replacement rates as well as on public social expenditures. Empirically, we use a sample of 14 economies (EU-15 excl. Lux.) between 1980 and 2005. The empirical findings reveal a presence of a convergence process, driven by strong catch-up of social protection levels in the Southern member states. Furthermore, convergence in replacement rates is substantially less pronounced than using spending data.

Suggested Citation

  • Paetzold, Jörg, 2012. "The Convergence of Welfare State Indicators in Europe: Evidence from Panel Data," Working Papers in Economics 2012-4, University of Salzburg.
  • Handle: RePEc:ris:sbgwpe:2012_004
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    References listed on IDEAS

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    1. Sinn, Hans-Werner, 2002. "EU Enlargement and the Future of the Welfare State," Scottish Journal of Political Economy, Scottish Economic Society, vol. 49(1), pages 104-115, February.
    2. Castles, Francis G., 2004. "The Future of the Welfare State: Crisis Myths and Crisis Realities," OUP Catalogue, Oxford University Press, number 9780199273928.
    3. Koen Caminada & Kees Goudswaard & Olaf Van Vliet, 2010. "Patterns of Welfare State Indicators in the EU: Is there Convergence?," Journal of Common Market Studies, Wiley Blackwell, vol. 48, pages 529-556, June.
    4. Im, Kyung So & Pesaran, M. Hashem & Shin, Yongcheol, 2003. "Testing for unit roots in heterogeneous panels," Journal of Econometrics, Elsevier, vol. 115(1), pages 53-74, July.
    5. Luisa Corrado & David A. Londo–o B. & Francesco S. Mennini & Giovanni Trovato, 2003. "The Welfare States in a United Europe," European Political Economy Review, European Political Economy Infrastructure Consortium, vol. 1(Spring), pages 40-55.
    6. Atkinson,Anthony Barnes, 1996. "Incomes and the Welfare State," Cambridge Books, Cambridge University Press, number 9780521557962.
    7. 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.
    8. Kittel, Bernhard & Winner, Hannes, 2002. "How reliable is pooled analysis in political economy? The globalization welfare state nexus revisited," MPIfG Discussion Paper 02/3, Max Planck Institute for the Study of Societies.
    9. Christopher F Baum, 2001. "Residual diagnostics for cross-section time series regression models," Stata Journal, StataCorp LP, vol. 1(1), pages 101-104, November.
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    Cited by:

    1. Athanasios Athanasenas & Xanthippi Chapsa & Athanasios Michailidis, 2015. "Investigating Social Protection Convergence in the EU-15: A Panel Data Analysis," European Research Studies Journal, European Research Studies Journal, vol. 0(2), pages 79-96.

    More about this item

    Keywords

    social protection; convergence; pension & unemployment replacement rates; Europeanization; welfare state;

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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