Social policies and activation in the Scandinavian welfare model: the case of Denmark

Torben M. Andersen ()
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Torben M. Andersen: Department of Economics and Business, Aarhus University, Denmark, Postal: 8000 Aarhus C, Denmark

Economics Working Papers from Department of Economics and Business Economics, Aarhus University

Abstract: Scandinavian countries are characterized by a generous tax-financed social safety net which provides insurance and performs a redistributive role. While contributing to lower inequality it may imply that incentives to work are low, and yet employment rates are high. How have the Scandinavian countries been able to reconcile social objectives with a high employment level? It is argued that the Scandinavian welfare model has a strong employment focus both because it is an important element in social policy based on social inclusion, but also because a collective welfare arrangement is only financially viable if (private) employment is sufficiently high. To ensure this, the social safety net includes a number of employment conditionalities (active labour market policies/workfare) to balance income protection with an employment focus. These policies are discussed using Denmark as an example and empirical evidence is presented. The criticism of workfare is also briefly discussed.

Keywords: workfare; employment; distribution; welfare state (search for similar items in EconPapers)
JEL-codes: H10 J20 J60 (search for similar items in EconPapers)
Pages: 27
Date: 2011-09-08
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