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Models of the welfare state in Europe

Economy

Specific Objectives and Competences

  • To know the origins and the foundations of the welfare state in Europe.
  • To know the different models for the welfare state in Europe.
  • To identify current problems for maintaining the system of social protection.

Contents

  • The “Welfare State” refers to the set of interventions organised by the state which are aimed at guaranteeing the provision of a minimum level of services to the population via a system of social protection.
  • The origins of this system of social protection can be traced back to the end of the 19th century in the Germany of Chancellor Bismarck. However, this system only became generalised in Europe after the Second World War.
  • The Welfare State is built on four main pillars:
    • Compulsory and free primary education and highly subsidised education at higher levels.
    • Initially universal, and free, health treatment, which in some areas of Europe has been restricted to certain collectives, with other citizens having to contribute to its cost.
    • Social security, and fundamentally pensions, which vary according to the payments made by workers throughout their working lives, although also insurance schemes that cover a number of different situations (orphans, widows, sickness, etc.).
    • Social services, including all the different types of aid destined to cover the needs of certain less favoured collectives, with specific emphasis on care for dependents.
  • A distinction has traditionally been made between three different types of Welfare State in Europe (Social Democracy, Conservative and Liberal). However, the fall of the communist block and the process of its integration within the market economy have generated a series of new types of welfare state in Central and Eastern Europe, which are still in the process of definition.
  • Below we detail the different models and their main characteristics:
    • The Social Democratic/Nordic Model. Main characteristics:
      • High taxes, high degree of income redistribution, high level of participation of women in the labour market, high standard of living and citizens with a high level of confidence in their public system (Denmark, Norway, Iceland, Finland and Sweden).
    • Conservative/Corporatist Model. Within this category there is   a small subgroup formed by the countries of the South of Europe, which share certain common traits, although these are not sufficiently important for them to be considered as an independent group. Main characteristics:
      • Low level of participation of women in the labour market, dependency on social contributions instead of on taxes, moderate redistribution of income and higher levels of unemployment, especially in the countries of the South of Europe. (Austria, Belgium, Germany, Greece, Italy, Malta, Cyprus, Turkey, Luxemburg, the Netherlands, Spain and Portugal)
    • Anglo-Saxon/Liberal Model. Main characteristics:
      • Low level of total state spending, high level of inequality and low level of expenditure on social protection. (Switzerland, the United Kingdom and Ireland)
    • Models still in the phase of definition in Central and Eastern Europe.
      • Model of the Former USSR. Main characteristics:
        • Similar to the conservative model with respect to total state spending. The greatest differences lie in the quality of life and level of confidence in the public system (Belarus, Estonia, Latvia, Lithuania, Russia and the Ukraine).
      • Model of Post-Communist Europe. The quality of life is greater than in the previous group and the system is more egalitarian. On the other hand, they present more moderate levels of economic growth and inflation than in countries associated with the previous model. (Bulgaria, Croatia, Czech Republic, Hungary, Poland and Slovakia).
      • Welfare State models in a process of development. This relates to countries that are still in the process of maturing their welfare states. Their programmes of state aid and indicators of quality of life are below those in the previously mentioned groups. Their high levels of infant mortality and low life expectancies reflect the difficult social situations found in these countries. (Georgia, Rumania and Moldavia).
  • To establish a clear idea of what social spending represents in each country, the OECD published figures for total public and private social spending by its member states in 2009; these included 21 EU countries.

Debates

According to the article The welfare state resists in the north and becomes weaker in the south (es), the crisis is the result of a gap between the models of welfare state in the north and south of Europe.

What implications could this phenomenon have for the process of European integration?

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