Economic history

Newspaper by: Guillermo,Alex,Nikol

Consequences of the welfare state

keypoints

-Political consequences -Economic implications

Political consequences

Few of the countries of Western Europe and North America were liberal democracies in the 1880s; all of them are today. The public sectors of most Western countries were relatively small in the 1880s; most of them are now much larger, to the point where most modern economies are referred to as mixed economies. The last 100 years, and in particular the last 30 years, have witnessed what must be the highest rates of economic growth in human history

Share of coutries with social protection schemes, by social insurances type in Western Europe

Example of Social Safety Net

Economic Implications

The welfare state has both positive and negative economic consequences. While social safety nets reduce poverty, improve living standards, and promote economic stability, critics argue excessive welfare spending can lead to inefficiencies and disincentivize work. Additionally, demographic challenges such as aging populations and declining birth rates pose significant fiscal sustainability concerns, necessitating reforms to ensure long-term viability.

https://www.worldbank.org/en/results/2019/11/08/a-social-safety-net-for-the-poorest-increasing-poor-households-access-to-safety-nets-and-laying-the-foundations-for-an-adaptive-social-safety-net-system-in-burkina-faso

The coming of political democracy undoubtedly promoted the development of the welfare state; the welfare state may well have made Western economies grow faster than they would otherwise have done.In addition, the analyst has to contend with the problem of counterfactuals. To ask questions about the consequences of any phenomenon in the real world is to ask what the world would have been like if the phenomenon had never come into existence or had operated differently.

Berhard Gilliam\Library of Congress

A political cartoon showing four leaders of large companies sitting on bags of "millions" while being carried on the backs of workers from various industries (1883).

conclusion

Refference list

1. Alesina, A., & Glaeser, E. (2004). Fighting Poverty in the US and Europe: A World of Difference. Oxford University Press. 2. Atkinson, A. B. (1995). The Welfare State and Economic Performance. National Bureau of Economic Research. 3. Esping-Andersen, G. (1990). The Three Worlds of Welfare Capitalism. Princeton University Press. 4. IMF (International Monetary Fund). (2019). Fiscal Monitor: Curbing Corruption. Retrieved from https://www.imf.org/en/Publications/FM/Issues/2019/04/03/Fiscal-Monitor-April-2019-Curbing-Corruption-46608

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