Measuring Welfare State Performance: Three or Two Worlds of Welfare Capitalism?

Cok Vrooman (), Paul Beer and Jean Marie Wildeboer Schut

No 276, LIS Working papers from LIS Cross-National Data Center in Luxembourg

Abstract: This paper examines the well-known classification of welfare regimes by Esping- Andersen (1990). First, the institutional characteristics of eleven welfare states are examined by means of a principal components analysis. This analysis confirms the existence of three types of welfare state, viz. the liberal welfare state (USA, Australia, United Kingdom and Canada), the social-democratic welfare state (Sweden, Denmark, Norway) and the corporatist welfare state (Germany, Belgium, France). The Netherlands, however, turns out to be a hybrid kind of welfare state, somewhere in between the social democratic and the corporatist welfare states. Next, we examine whether these three types of welfare state correspond to a threefold classification in terms of the traditional protective functions of the welfare state. By using LIS-data from the first half of the 1990s we compare eleven welfare states with respect to the degree of income leveling by the social security and tax system, the rate of inequality of disposable household incomes, the level of social welfare (interpreted as a combination of income level and income equality) and the poverty rate. We find that there is indeed a clear dividing line between the liberal welfare states on the one hand and the social-democratic and corporatist welfare states on the other. The liberal welfare states perform consistently worse on the indicators for income leveling, income (in)equality and poverty, but not with respect to the level of social welfare. There is however no consistent difference in performance between the social-democratic countries and the corporatist countries. There rather seems to be a combined group of continental European countries, existing of both social-democratic and corporatist welfare states and the hybrid Netherlands, that achieve roughly comparable results in terms of income protection by using quite different institutions. Hence, although there are indeed three types of welfare state as far as institutional arrangements are concerned, it is better to discern only two types of welfare state with respect to income (re)distribution, social welfare en poverty.

Pages: 38 pages
Date: 2001-05
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Citations: View citations in EconPapers (4)

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