Problems of the German Welfare State after Unification

Richard Hauser

Oxford Review of Economic Policy, 1995, vol. 11, issue 3, 44-58

Abstract: This article reviews the public and the scientific discussion about the German welfare state. Following a sketch of the main institutional features, some economic indicators and statistics about the share of social expenditure are presented. Indicators of inequality show almost no change in the distribution of equivalent income 1973 to 1990, despite a stepwise increase in unemployment. After unification, the share of social expenditures in gross national product has gone up sharply, but income distribution in West Germany did not change, while in East Germany, a considerable increase in inequality can be found. Although poverty reports show increasing problems, the German discussion about a crisis of the welfare state is considered exaggerated in view of the good performance of the German welfare state in solving the huge problems of unification. Finally, the article reviews short-run and long-run problems of the German welfare state and tendencies to retrenchment. Copyright 1995 by Oxford University Press.

Date: 1995
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Persistent link: https://EconPapers.repec.org/RePEc:oup:oxford:v:11:y:1995:i:3:p:44-58

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