Efficient and Inefficient Welfare States

Pierre Cahuc, Yann Algan and Marc Sangnier

No 8229, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: This paper shows that cross country differences in the generosity and the quality of the welfare state are associated with differences in the trustworthiness of their citizens. We show that generous, transparent and efficient welfare states in Scandinavian countries are based on the civicness of their citizens. In contrast, the generosity but low transparency of the Continental European welfare states survive thanks to the support of a large share of uncivic individuals who consider that it can be justifiable to misbehave with taxes and social benefits. We also explain why countries with an intermediate degree of trustworthiness of their citizens and of transparency of the government, like Anglo-Saxon countries, have small welfare states. Overall, this paper provides a rationale for the observed persistence of both efficient and inefficient welfare states, as a function of the civicness of the citizens.

Keywords: Civism; Corruption; Trust; Welfare state (search for similar items in EconPapers)
JEL-codes: H1 Z1 (search for similar items in EconPapers)
Date: 2011-02
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Citations: View citations in EconPapers (44)

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Related works:
Journal Article: Trust and the Welfare State: the Twin Peaks Curve (2016)
Working Paper: Trust and the Welfare State: The Twin Peaks Curve (2014)
Working Paper: Trust and the Welfare State: the Twin Peaks Curve (2014)
Working Paper: Trust and the Welfare State: The Twin Peaks Curve (2014)
Working Paper: Trust and the Welfare State: The Twin Peaks Curve (2014)
Working Paper: Efficient and Inefficient Welfare States (2011)
Working Paper: Efficient and Inefficient Welfare States (2011)
Working Paper: Efficient and Inefficient Welfare States (2011)
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