Systems of Welfare in a Changing World: Implications for Korea p - PowerPoint PPT Presentation

Systems of Welfare in a Changing World: Implications for Korea p Martin Seeleib-Kaiser Paper prepared for presentation at the seminar “Korea in Search of a New Welfare State Model” Korea Institute of Finance (KIF) Seoul Korea Institute of Finance (KIF), Seoul 27 September 2012

Systems of Welfare in a Changing World Argument � Welfare state typologies, categorizing various models or systems of welfare, are helpful heuristic tools to understand institutional differences of social policy design and explain institutional differences of social policy design and explain outcomes. � Social spending and social protection should not only be categorized as economic cost, but can also benefit economic development (politics for the market?!). � Variations in inequality and poverty among the affluent � Variations in inequality and poverty among the affluent democracies of the OECD world can be (partially) explained by differences in welfare state generosity and institutional design. � Welfare regimes are rooted in different political philosophies – politics do make a difference – democracy matters! Page 2

Systems of Welfare in a Changing World Overview � Typologies, Systems of Welfare and Welfare Regimes g � Social Spending and Economic Performance � Systems of Welfare/Welfare Regimes and Systems of Welfare/Welfare Regimes and Outcomes � Poverty and Social Protection Dualism y � Implications for Korea Page 3

Systems of Welfare in a Changing World “The more one attempts to study the international literature about different national social policy institutions the more one becomes aware of the institutions, the more one becomes aware of the diversity and complexity. The more one understands this complexity, the more difficult does it become to generalise (to simplify pragmatically) about the different li (t i lif ti ll ) b t th diff t roles that social services are supposed to play – and do actually play – in different countries.” R. Titmuss (1974) Social Policy . London: Unwin, 16-17. When we talk about typologies or systems of welfare we intentionally simplify to understand institutional differences at a intentionally simplify to understand institutional differences at a relatively abstract level Page 4

Systems of Welfare in a Changing World Titmuss’ Typology • Residual Model of Social Policy • Industrial Achievement-Performance Model of Social Policy (=productivist model?) • Institutional Redistributive Model of Social Policy Page 5

Systems of Welfare in a Changing World Regime Typology (Esping Andersen) Regime Typology (Esping-Andersen) Liberal Liberal Conservative Conservative Social- Social- Democratic Eligibility Poor Workers/ Citizens/ Insured Insured Residents Residents Financing Taxation Social-insurance Taxation Contributions Contributions Benefits Means-tested Earnings/ Flat and Contributions- Contributions universal universal related Page 6

Systems of Welfare in a Changing World R Regime Typology i T l Liberal Welfare States (residual): Australia, United States, New Zealand, Canada, Ireland, United Kingdom Conservative Welfare States (industrial achievement- performance model): Italy, Japan, France, Germany, Finland, Switzerland y, p , , y, , Social-Democratic Welfare States (institutional redistributive): ) Austria, Belgium, Netherlands, Denmark, Norway, Sweden Based on Esping-Andersen’s Decommodification Index around 1980. G. Esping-Andersen (1990) The Three Worlds of Welfare Capitalism . Cambridge: Polity Press Cambridge: Polity Press. Page 7

Systems of Welfare in a Changing World Challenges: � Globalization Gl b li ti � Demographic change (ageing, low fertility) � Changing labour markets and unemployment � Societal fragmentation and increased individualism Societal fragmentation and increased individualism Regime/System Stability over time? Page 8

Systems of Welfare in a Changing World Denmark Public Social Expenditure in Percent of GDP Finland 35 France Germany 30 Italy Japan 25 Spain Sweden 20 Switzerland Switzerland United Kingdom 15 United States United States OECD ‐ Total 10 1980 1985 1990 1995 2000 2005 Source: OECD Page 9

Systems of Welfare in a Changing World Welfare State Generosity 50.0 50 0 45.0 40 0 40.0 Denmark Denmark Germany 35.0 Italy 30.0 30.0 J Japan 25.0 Sweden United Kingdom 20.0 United States 15.0 10.0 1971 1976 1981 1986 1991 1996 2001 Source: Srcuggs 2004 gg Page 10

Decommodification Over Three Decades: 1970s, 1980s and 1990s Source: E. Ferragina, M. Seeleib-Kaiser, M. Tomlinson: “Unemployment Protection and Family Policy at the Turn of the 21st Century: A Dynamic Approach to Welfare Page 11 Regime Theory,” Social Policy and Administration , forthcoming

Systems of Welfare in a Changing World � Pension systems Pension systems • Introduction of / shift towards the third pillar, i.e. occupational and private funded pensions • Increase in the retirement age I i th ti t � Unemployment Insurance • Reduction in replacement rates • Activation and increased conditionality • • No clear trend with regard to covering labor market outsiders No clear trend with regard to covering labor market outsiders � Family policy revolution • Increase in institutional childcare provision • Improved parental leave Page 12

Family Policy (R)evolution (1980-2008)? 2 SOCIAL DEMOCRATIC SOCIAL DEMOCRATIC Non Swe4 Swe4 Swe4 Swe4 Swe4 Swe4 Swe4 Swe4 Swe4 comprehensive/r Comprehensive Nor4 Nor4 Nor4 Nor4 Nor4 Nor4 Nor4 Nor4 Nor4 Ost4 Ost4 Ost4 Ost4 Ost4 Ost4 Ost4 Ost4 Ost4 esidual family child care, long Fin4 Fin4 Fin4 Fin4 Fin4 Fin4 Fin4 Fin4 Fin4 policy along all Fin3 Fin3 Fin3 Fin3 Fin3 Fin3 Fin3 Fin3 Fin3 Fin3 duration of Fra4 Fra4 Fra4 Fra4 Fra4 Fra4 Fra4 Fra4 Fra4 Swe3 Swe3 Swe3 Swe3 Swe3 Swe3 Swe3 Swe3 Swe3 Swe3 dimensions leave and high RADICALS & LIBERALS Fra3 Fra3 Fra3 Fra3 Fra3 Fra3 Fra3 Fra3 Fra3 Fra3 Ost3 Ost3 Ost3 Ost3 Ost3 Ost3 Ost3 Ost3 Ost3 Ost3 replacement 1 Aus2 Aus2 US2 Aus2 Aus2 US2 US2 US2 US2 US2 US2 Aus2 Aus2 Aus2 US2 US2 Aus2 Aus2 Aus2 US2 rates rates US3 US3 US3 US3 US3 US3 US3 US3 US3 US3 US3 US3 US3 US3 US3 US3 US3 US3 US3 US3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ3 NZ2 NZ2 NZ2 NZ2 NZ2 NZ2 NZ2 NZ2 NZ2 NZ2 US4 US4 US4 US4 US4 US4 US4 US4 US4 Swi2 Swi2 Swi2 Swi2 Swi2 Swi2 Swi2 Swi2 Swi2 Swi2 Fin2 Fra2 Fra2 Fra2 Fra2 Fra2 Fra2 Fra2 Fra2 Fra2 Fra2 Jap2 Jap2 Jap2 Jap2 Jap2 Jap2 Jap2 Jap2 Jap2 Jap2 Fin2 Fin2 Fin2 Fin2 Fin2 Fin2 Fin2 Fin2 Fin2 Ire2 Ire2 Ire2 Ire2 Ire2 Ire2 Ire2 Ire2 Ire2 Ire2 Swe2 Swe2 Swe2 Swe2 Swe2 Swe2 Swe2 Swe2 Swe2 Swe2 Ger4 Ger4 Ger4 Ger4 Ger4 Ger4 Ger4 Ger4 Ger4 Aus3 Aus3 Aus3 Aus3 Aus3 Aus3 Aus3 Aus3 Aus3 Aus3 Net2 Net2 Net2 Net2 Net2 Net2 Net2 Net2 Net2 Net2 NZ4 NZ4 NZ4 NZ4 NZ4 NZ4 NZ4 NZ4 NZ4 Swi4 Swi4 Swi4 Swi4 Swi4 Swi4 Swi4 Swi4 Swi4 Ger3 Ger3 Ger3 Ger3 Ger3 Ger3 Ger3 Ger3 Ger3 Ger3 Ire3 Ire3 Ire3 Ire3 Ire3 Ire3 Ire3 Ire3 Ire3 Ire3 UK4 UK4 UK4 UK4 UK4 UK4 UK4 UK4 UK4 dim2 Nor3 Nor3 Nor3 Nor3 Nor3 Nor3 Nor3 Nor3 Nor3 Nor3 0 Swi3 Swi3 Swi3 Swi3 Swi3 Swi3 Swi3 Swi3 Swi3 Swi3 Medium childcare Aus4 Aus4 Aus4 Aus4 Aus4 Aus4 Aus4 Aus4 Aus4 Aus4 Aus4 Aus4 Aus4 Aus4 Aus4 Aus4 Aus4 Aus4 UK2 UK2 UK2 UK2 UK2 UK2 UK2 UK2 UK2 UK2 UK2 UK2 UK2 UK2 UK2 UK2 UK2 UK2 UK2 UK2 d services, medium ‐ long Ost2 Ost2 Ost2 Ost2 Ost2 Ost2 Ost2 Ost2 Ost2 Ost2 Can2 Can2 Can2 Can2 Can2 Can2 Can2 Can2 Can2 Can2 duration of leave and medium replacement rates, but high child Ire4 Ire4 Ire4 Ire4 Ire4 Ire4 Ire4 Ire4 Ire4 Can3 Can3 Can3 Can3 Can3 Can3 Can3 Can3 Can3 Can3 Den2 Den2 Den2 Den2 Den2 Den2 Den2 Den2 Den2 Den2 UK3 UK3 UK3 UK3 UK3 UK3 UK3 UK3 UK3 UK3 Net3 Net3 Net3 Net3 Net3 Net3 Net3 Net3 Net3 Net3 Low ‐ medium allowance Jap3 Jap3 Jap3 Jap3 Jap3 Jap3 Jap3 Jap3 Jap3 Jap3 Den3 Den3 Den3 Den3 Den3 Den3 Den3 Den3 Den3 Den3 Bel2 Bel2 Bel2 Bel2 Bel2 Bel2 Bel2 Bel2 Bel2 Bel2 Net4 Net4 Net4 Net4 Net4 Net4 Net4 Net4 Net4 -1 Ger2 Ger2 Ger2 Ger2 Ger2 Ger2 Ger2 Ger2 Ger2 Ger2 comprehensive childcare Ita4 Ita4 Ita4 Ita4 Ita4 Ita4 Ita4 Ita4 Ita4 Ita4 Ita4 Ita4 Ita4 Ita4 Ita4 Ita4 Ita4 Ita4 services and Bel3 Bel3 Bel3 Bel3 Bel3 Bel3 Bel3 Bel3 Bel3 Bel3 Jap4 Jap4 Jap4 Jap4 Jap4 Jap4 Jap4 Jap4 Jap4 Bel4 Bel4 Bel4 Bel4 Bel4 Bel4 Bel4 Bel4 Bel4 Ita3 Ita3 Ita3 Ita3 Ita3 Ita3 Ita3 Ita3 Ita3 Ita3 short ‐ medium Ita2 Ita2 Ita2 Ita2 Ita2 Ita2 Ita2 Ita2 Ita2 Ita2 duration of CHRISTIAN DEMOCRATIC Den4 Den4 Den4 Den4 Den4 Den4 Den4 Den4 Den4 Nor2 Nor2 Nor2 Nor2 Nor2 Nor2 Nor2 Nor2 Nor2 Nor2 leave Can4 Can4 Can4 Can4 Can4 Can4 Can4 Can4 Can4 -2 -2 2 -1 1 0 0 1 1 2 2 dim1 Source: E. Ferragina, M. Seeleib-Kaiser, M. Tomlinson: “Unemployment Protection and Family Policy at the Turn of the 21st Century: A Dynamic Approach to Welfare Regime Page 13 Theory,” Social Policy and Administration , forthcoming