Political Economy Students' Journal

Introduction 

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The world that we live in today is divided in more ways than one, as it has been in many moments throughout history. The division of the world in Western and Eastern countries puts into evidence a geographical and developmental division, but does this mean that there are no differences within the divisions already made? Do the countries in each group have the same features? Do the countries in each group have the same views on society just because they are all Eastern or all Western? And what implications does this division have regarding welfare states and their configurations? 

In this essay, my goal is to answer the question: “Why do welfare states vary in the Western world?” by presenting three main reasons for this variation: political factors, cultural factors and differences in the design of the welfare state institutions. This essay will begin with a brief definition of the two key concepts, followed by an explanation of the three main reasons above mentioned in the same exact order as they are presented in the previous sentence (always supported by examples of Western countries that illustrate what is being said). Then, to complete the task given to me, a conclusion will be made, where the main argument will be summarized. 

In order to fully understand the question presented, some important concepts must be defined. The first concept that needs clarification is Western world. For the purpose of this essay, the Western world countries will be considered as the United States of America (USA), Australia and New Zealand, the Scandinavian countries, Continental Europe, The United Kingdom (UK) and Southern European countries. The second concept that needs explanation is welfare state. As Esping-Andersen defined in 1990, the welfare state is the “State responsibility for securing some basic modicum of welfare for its citizens”.

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Welfare state policies as a consequence of political action

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The welfare state is an essential dimension of a country’s everyday life since it affects and involves a large portion of the population, either as recipients or contributors. One reason that allows distinction between welfare states within Western economies is political factors, mainly the nature of the political party that is in power.  

Every political party has its unique agenda and a different priority list when it comes to discussing the social problems that influence their voters’ lives. Two political parties can have very different views on which course of action is best suited to deal with a specific problem and to what extent emphasis should be given to that exact problem. Since “welfare state policies, are in the first instance, the direct result of decisions made by political actors” (Aspalter, 2006), it is of extreme importance the nature of the political party that is proposing, designing, accepting and implementing these policies. 

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The nature of the political party already assumes a certain way of seeing the current economic reality and its different challenges and possible solutions. The particular way a political party in power values a different social problem over the other, for example,  unemployment over inflation or vice-versa, will influence their actions and, consequently,  their welfare state policies. A focus on different social actors also influences the type of policies being proposed. That means that the welfare states’ features can vary according to which and who the primary focus of a government’s social policy is. (Aspalter, 2006) 

In Sweden (a Scandinavian country), the parties in power were, up until the 1950s,  mainly social democratic parties. A social democratic party's main focus in social policy is ensuring social citizenship rights. That is a direct consequence of the centrality of the individual and its relationship with the state in the hierarchy of social problems and social actors. This attributes particular features to their welfare state, such as the preponderance in attributing benefits depending on the individual alone (as a single unit) and not on his family context. 

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In Continental Europe countries, the nature of the political parties in power is slightly different from that of Sweden. The parties in power are best characterized as  Christian-democratic parties. The main unit of analysis is the family and a strong emphasis is given to the relationship between families and the State. The main focus and goal of the social policies that are put in place is ultimately to allow for the guarantee of social insurance rights. That means that, when compared to Sweden, the policies will be a bit different: policies will be focused on providing benefits accordingly to the aggregate unit to which the individual belongs to. For example, allowing for certain jobs to give health insurance not only to the employee but for his young children or spouse as well. 

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So, it can be stated that the nature of the political parties in power can account for variations in welfare states as it shifts the focus of the leading social topic or right to ensure and who is considered the main unit of analysis: the individual or the family. 

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Culture as an engine for differences

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The differences observed between welfare states can be partially explained by political factors, as described in the previous section of this essay. However, what distinguishes two countries with the same kind of political party in power? That is when cultural factors need to be added to the mixture of explanations for the variation in countries' welfare states. The link between political and cultural factors is pretty much undeniable, as “Political structures operate within cultural frameworks …” (Taylor Gooby, 2001), which gives culture a significant importance to this discussion. The cultural system of a country influences their welfare state through the influence on social structures, on the social practices of individuals and even the influence on the political actors. 

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The social structures of an economy include the structure of the division of labor and include the institutions within a society which are considered pivotal, such as the labor market, the third sector of the economy (non-profit sector) and the family, for example. Welfare state policies regarding employment and social security depend on how these concepts are, first of all, defined and conceived. The way we define a concept is deeply influenced by our surroundings and our culture, and this can have different implications when discussing welfare state policies. The prism through which employment protection is seen depends on how different jobs, professions, and even life conditions are considered to need more or less protection. One example of this is the differences in policies regarding the integration of migrants in the workplace. If a country has as cultural value the acceptance and integration of migrants in the everyday life, it will have very different policies than countries that intend to segregate and confine migrants instead of integrating them.

 

Culture is, as explained in the previous paragraph, a determinant of social structures. Its influence is not simply confined to the aggregate level, it also influences and brands the social practice of individuals. Cultural values have the ability to “shape the range of options for choice that are considered by individuals” (Pfau-Effinger, 2004). This means that cultural values affect how a person views their options and, as a consequence, the decisions made when faced with a choice regarding welfare state policies. This is an example of why the same exact social policy can have different effects depending on the context to which it was applied, in this case, depending on the country.  A concrete illustration of the point being made in this paragraph is the example given by Pfau-Effinger when comparing the effects of parental leave. The countries analyzed were Finland and Germany. With a very similar policy on parental leave, the two countries showed very different take-up rates of the parental leave scheme, which were higher in Germany than in Finland. The explanation for this is the cultural idea concerning childhood. Germans have as cultural norm and belief that being home is the place that benefits young children the most, which leads them to take up with much more frequency the right-given parental leave than Finnish people would. 

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The social practices of individuals can be affected by culturally accepted thoughts as demonstrated in the example given, but this only illustrates a situation where no conflict is present. What happens when cultural values and attitudes differ across the country? What happens when the cultural attitudes of the population are in direct conflict with the political decisions? Political and public discourses act as the mediators. These cultural differences mean that the political actors are now in a powerful position that will influence which cultural values will guide the proposed social policies. 

Culture will now influence the political actors by influencing their next move: They can either persuade the population to turn to different values or compromise and try to reach common ground with the accepted values of part of the nation. This next move will most likely be the culturally accepted thing to do, as politicians and political parties depend on voters.

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To conclude, it can be said that culture is an engine for differences regarding welfare states in the Western world because it changes social structures, attitudes regarding specific policies, and affects the actions and discourses of political actors. 
 

The institutions’ design- a force to be reckoned with 

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Welfare state institutions do not exist in a black void, they are dependent on other factors to be created, implemented and even discussed. This type of institution clearly depends on the political and cultural context and are all interconnected and interdependent. If there was no political or cultural context, the welfare state institutions would not even be able to be imagined. Thus, the design of the welfare state institutions depends on cultural and political reasons, which is why it appears as the last answer to the question that is to be answered with this essay. 

A critical aspect of the welfare state is the need for redistribution. The redistribution strategy needs to be considered when we discuss the design of some institutions of the welfare state. The strategy can vary from country to country, and this leads to differences in the welfare states between countries. There are two distinct types of redistribution: horizontal and vertical, each one with a different purpose. On one hand, horizontal redistribution has as main goal spreading income across the life cycle. 

Throughout our human life cycle, we do not always have the exact needs or the same work capacity, and that is why some intervention is needed to protect those who are in a period of life when they are more vulnerable. On the other hand, vertical redistribution concerns different income levels and aims to close the gap between rich and poor people as much as possible. Once again, we have a situation where the more vulnerable need to be taken into consideration. The distribution strategy influences a strong deal of institutions and consequently, welfare state policies (Palme, 2006). 

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The predominance of policies with a particular focus on children or on the elderly population leads to a different variation of the welfare state. The choices between reducing income inequality or eventually rising the pension level all have taken into account what is the primary purpose of the redistribution: vertical or not. A special focus on family-directed policies can also be seen as horizontal redistribution since both infants and new parents are at a particularly vulnerable moment of life. 

The Scandinavian countries have a very particular design of welfare state institutions which gives them a very unique welfare state. In Scandinavia, a common feature of their welfare state model is a parental leave that benefits both parents in terms of duration and earning replacement. This welfare state model is also characterized by publicly subsidizing childcare after the end of the parents’ leave. All these features would be remarkably different if the point of the redistribution or if priority was given to some other social interaction. 

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The continental European countries have a different way of looking into the family social policies. This originates a different institutional design and, consequently, a different welfare state model. In most of these countries, parental leave is different if it regards a mother or a father. Women are given more time of parental leave when compared to what is given to men and this influences the labor market of that specific country. The influence on the labor market is seen through the different paid-sick days between genders or the more widely accepted absence of mothers from working time. 

To summarize this point, it is very urgent to highlight that the institutional design of the welfare models is a significant force to be reckoned with as it changes the purpose of policies and their features.
 

Conclusion

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The countries within the Western world are not all equal to one another and have more differences than what one might initially anticipate and expect. One of the things that distinguishes these countries is their welfare state. Each country has different set of features that accounts for the variation of the welfare state in comparison to the country that is their next-door neighbour. 

The variation of the welfare state is a consequence of not only political factors but also cultural factors. These political and cultural factors influence the design of the welfare state institutions, which is another good reason to stress the differences between countries. 

Regarding political factors, this essay can conclude that the nature of the political parties in power can account for variations in welfare states as it shifts the focus of the leading social topic or right to ensure and who is considered the central unit of analysis of the social policies. 

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Regarding cultural factors, this essay can conclude that culture is an engine for differences regarding welfare states in Western countries because it changes social structures and attitudes regarding specific policies and affects the actions and discourses of political actors. 

When discussing the design of the welfare state institutions, the main conclusion is that it is deeply influenced by political and cultural factors. It is an important answer to the question of this essay because it changes the purpose of policies and their features. 

In conclusion, the answer to the question: “Why do welfare states vary in the Western world?” is that political factors, cultural factors, and institutional design make countries different as a consequence of making welfare states different.
 

References 

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Aspalter, C. (2006). New Developments in the Theory of Comparative Social Policy.  Journal of Comparative Social Welfare, 22(1), 3–22. https://doi.org/10.1080/17486830500522963 

 

Esping-Andersen, G. (1990). The three political economies of the welfare state. In The three worlds of welfare capitalism (pp. 9–34). Cambridge: Polity Press. Palme, J. (2006). Welfare states and inequality: Institutional designs and distributive outcome. Research in Social Stratification and Mobility, 24(4), 387–403.  https://doi.org/10.1016/j.rssm.2006.10.004 

 

Pfau-Effinger, B. (2004). Culture and Welfare State Policies: Reflections on a Complex  Interrelation. Journal of Social Policy, 34(1), 3–20. https://doi.org/10.1017/s0047279404008232 

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Taylor-Gooby, P. (2001). The politics of welfare in Europe. In Welfare states under  

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