The Welfare State besides Globalization Forces
Assaf Razin () and
No 13106, CEPR Discussion Papers from C.E.P.R. Discussion Papers
Globalization - a widespread contemporaneous phenomenon - generates international tax competition. The consequent erosion in the tax base, especially on capital, is a blow to the finances of the welfare state, with far-reaching implications for the redistribution of income by the welfare state. Low skill migration attracted to the welfare state may put additional strain on it. An aging welfare state - a common contemporary phenomenon in many industrial countries - calls in for young and high skill immigrants for its survival. This review is about how economists should think about the connection between globalization and the welfare state, with strong motivating historical examples and empirical facts, and non-technical analytics.
JEL-codes: F00 H00 (search for similar items in EconPapers)
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Working Paper: The Welfare State besides Globalization Forces (2018)
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