An Empirical Analysis of the Dynamics of the Welfare State: The Case of Benefit Morale

Martin Halla, Mario Lackner and Friedrich Schneider ()

No 4165, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Does the supply of a welfare state create its own demand? Many economic scholars studying welfare arrangements refer to Say's law and insinuate a self-destructive welfare state. However, little is known about the empirical validity of these assumptions and hypotheses. We study the dynamic effect of different welfare arrangements on benefit fraud. In particular, we analyze the impact of the welfare state on the respective social norm, i.e. benefit morale. It turns out that a high level of public social expenditures and a high unemployment rate are associated with a small positive (or no) immediate impact on benefit morale, which however is crowded out by adverse medium and long run effects.

Keywords: welfare state; social norms; benefit fraud; benefit morale (search for similar items in EconPapers)
JEL-codes: A13 H20 I30 I38 J65 J68 Z13 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2009-05
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Published - revised version published in: Kyklos, 2010, 63 (1), 55-74

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Related works:
Journal Article: An Empirical Analysis of the Dynamics of the Welfare State: The Case of Benefit Morale* (2010)
Working Paper: An Empirical Analysis of the Dynamics of the Welfare State: the Case of Benefit Morale (2009)
Working Paper: An Empirical Analysis of the Dynamics of the Welfare State: The Case of Benefit Morale (2009)
Working Paper: An Empirical Analysis of the Dynamics of the Welfare State: The Case of Benefit Morale (2009)
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