Skip to main content Accessibility help
×
Hostname: page-component-78c5997874-ndw9j Total loading time: 0 Render date: 2024-11-06T09:49:52.833Z Has data issue: false hasContentIssue false

2 - International integration and the welfare state

Published online by Cambridge University Press:  22 September 2009

Torben M. Andersen
Affiliation:
Professor of Economics University of Aarhus, Denmark; Research Fellow Centre for Economic Policy Research
Torben M. Andersen
Affiliation:
Aarhus Universitet, Denmark
Per Molander
Affiliation:
Studieförbundet Näringsliv och Samhälle
Get access

Summary

Introduction

International integration is a frequently highlighted challenge facing welfare states, not least the extended models developed in Northern European countries. The process of tighter international integration is by some taken to imply that welfare states have to be rolled back, while others point to this as strengthening the need for welfare state activities. These issues are increasingly brought to the forefront in policy debates on the welfare state, but also in many cases shaping views on the pros and cons of international integration.

It is indisputable that international integration is proceeding at a rapid pace and that it changes economic structures, and therefore in turn both the scope and need for welfare state activities. In the increasing amount of literature on these issues it is possible to identify three different lines of reasoning. One view is that the welfare state will have to be rolled back since it will become increasingly difficult to finance welfare state arrangements through general taxation (see e.g. Sinn 1998; Tanzi 2000; Wildasin 2000a). A contesting view is that the welfare state has developed in response to various changes in society including different family structures and gender equalisation, but also risks induced by, among other things, international integration (see e.g. Rodrik 1997, 1998; Kautto et al. 2000). Countries may differ in how far they have proceeded in this development, but they will eventually all encounter these factors, which necessitate an expansion of welfare state activities.

Type
Chapter
Information
Alternatives for Welfare Policy
Coping with Internationalisation and Demographic Change
, pp. 23 - 48
Publisher: Cambridge University Press
Print publication year: 2003

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Alesina, A. and Perotti, P., 1997, ‘The welfare state and competitiveness’, American Economic Review, 87, 921–39Google Scholar
Alesina, A. and Wacziarg, R., 1997, ‘Openness, country size and the government’, NBER working paper 6024
Andersen, T. M., 2001a, ‘Welfare policies, labour markets and international integration’. International Tax and Public Finance (forthcoming)Google Scholar
Andersen, T. M. 2001b, ‘Product market integration, wage dispersion and unemployment’, IZA working paper
Andersen, T. M. 2002, ‘International integration, risk and the welfare state’, Scandinavian Journal of Economics, 2002, 104, 343–64CrossRefGoogle Scholar
Andersen, T. M. 2003, ‘European integration and the welfare state’. Journal of Population Economics, 16, 1–19CrossRefGoogle Scholar
Andersen, T. M., Haldrup, N. and Sørensen, J. R., 2000, ‘Labour market implications of EU product market integration’, Economic Policy, 30, 105–33Google Scholar
Andersen, T. M., Rasmussen, B. S., and Sørensen, J. R., 1996, ‘Optimal fiscal policies in open economies with labour market distortions’, Journal of Public Economics, 63, 103–17CrossRefGoogle Scholar
Atkinson, A. B., 1999, The economic consequences of rolling back the welfare state, Munich Lectures in Economics, Cambridge, Mass.: MIT Press
Baldwin, R. E. and Krugman, P., 2000, ‘Agglomeration, integration and tax harmonization’, CEPR discussion paper 2630
Boix, C., 1999, ‘Why does the public sector grow? The role of economic development, trade and democracy?’ Els Pucles del CREI, Universitat Pompeu Fabra
Brueckner, Jan K., 2000, ‘Welfare reform and the race to the bottom: theory and evidence’, Southern Economic Journal, 66, 505–25CrossRefGoogle Scholar
Cameron, D. R., 1978, ‘The expansion of the public economy’, American Political Science Review, 72, 1243–61CrossRefGoogle Scholar
Chari, V. V. and Kehoe, P. J., 1990, ‘International coordination of fiscal policy in limiting economies’, Journal of Political Economy, 98, 617–36CrossRefGoogle Scholar
Christiansen, V., Hagen, K. P. and Sandmo, A., 1994, ‘The scope for taxation and public expenditure in an open economy’, Scandinavian Journal of Economics, 96, 289–309CrossRefGoogle Scholar
Crafts, N., 2000, ‘Globalization and growth in the twentieth century’, IMF working paper WP/00/44
Daveri, F. and Tabellini, G., 2000, ‘Unemployment, growth and taxation in industrial countries’, Economic Policy, 30, 47–104Google Scholar
Devereux, M. B., 1991, ‘The terms of trade and the international coordination of fiscal policy’, Economic Inquiry, 29, 720–36CrossRefGoogle Scholar
Dowrick, S., 1989, ‘Union-oligopoly bargaining’, Economic Journal, 99, 1123–42CrossRefGoogle Scholar
Esping-Andersen, G., 1999, Social foundations of postindustrial economies, Oxford: Oxford University Press
European Commission, 2000, Structures of the taxation systems in the European Union, 1970–1997, EUROSTAT
Fatas, A. and Mihov, I., 1999, ‘Government size and automatic stabilizers, international and intranational evidence’, CEPR discussion paper 2259
Flanagan, R. J., 1999, ‘Macroeconomic performance and collective bargaining: an international perspective’, Journal of Economic Literature, 37, 1150–75CrossRefGoogle Scholar
Frankel, J. A. and Rose, A. K., 1998, ‘The endogeneity of the optimal currency area criteria’, Economic Journal, 108, 1008–25CrossRefGoogle Scholar
Gorter, J., 2000, ‘How mobile is capital within the European Union?’ Central Planning Bureau, 00/4
Holmlund, B., and Kolm, A.-S., 2002, Economic integration, imperfect competition, and international policy coordination, Oxford Economic Papers
IMF, 1999, International capital markets: developments, prospects and key policy issues
Iversen, T. and Cusack, T. E., 2000, ‘The causes of welfare state expansion, deindustrialization and globalization’, World Politics, 52, 313–49CrossRefGoogle Scholar
Kalemi-Ozcan, S., Sørensen, B. and Yosha, O., 2000, ‘Economic integration, industrial specialization, and the asymmetry of macroeconomic fluctuations’, working paper
Kautto, M., Bjørn Hvinden, J. F., Kvist, J. and Uusitalo, H., 2000, Nordic welfare states in a European context, London: Routledge
Krugman, , 1995, ‘Increasing returns, imperfect competition and the possible theory of international trade’, in Handbook of International Economics, Vol. CrossRefGoogle Scholar
Lewis, K. K., 1999, ‘Trying to explain home bias in equities and consumption’, Journal of Economic Literature, 37, 571–608CrossRefGoogle Scholar
Lumsdaine, R. L. and Prasad, E. S., 1997, ‘Identifying the common component in international economic fluctuations’, NBER working paper 5984
OECD, 1994, The Job Study
OECD 1997, Employment Outlook, July
OECD 1999, ‘Policy briefs – open markets matter: the benefits of trade and investment liberalisation’, October
OECD, 2000, OECD in Figures, Paris: OECD
Pierson, C., 1998, Beyond the welfare state: the new political economy of welfare, London: Polity Press (2nd edn)
Pissarides, C., 1998, ‘The impact of employment tax cuts on unemployment and wages: the role of unemployment benefits and tax structure’, European Economic Review, 42, 155–84CrossRefGoogle Scholar
Ploeg, R., 1987, ‘Coordination of optimal taxation in a two-country equilibrium model’, Economics Letters, 24, 279–85CrossRefGoogle Scholar
Primarolo group, 1999, ‘Code of conduct (business taxation), European Commission’, www.ue.eu.int/newsroom
Rodrik, D., 1997, Has globalization gone too far? Washington: Institute for International Studies
Rodrik, D. 1998, ‘Why do more open economies have bigger governments?Journal of Political Economy, 106, 997–1032CrossRefGoogle Scholar
Romer, D., 1999, ‘Changes in business cycles: evidence and explanations’, Journal of Economic Perspectives, 13, 23–44CrossRefGoogle Scholar
Sinn, H.-W., 1998, ‘European integration and the future of the welfare state’, Swedish Economic Policy Review, 5, 113–32Google Scholar
Slaugther, M. J. and Swagel, P., 1997, ‘The effects of globalization on wages in advanced economies’, IMP working paper, 97–43
Sørensen, P. B., 1997, ‘Public finance solutions to the European unemployment problem?’ Economic Policy, 25, 223–64Google Scholar
Sørensen, P. B. 2000, ‘The case for international tax co-ordination reconsidered’, Economic Policy, 31, 429–72Google Scholar
Summers, L., Gruber, J. and Vegara, R., 1993, ‘Taxation and the structure of labor markets’, Quarterly Journal of Economics, 94, 385–411CrossRefGoogle Scholar
Swank, D. H., 2002, Global capital, political institutions and policy change in developed welfare states, Cambridge: Cambridge University Press
Tanzi, V., 2000, ‘Globalization and the future of social protection’, IMF working paper, WP/00/12
Turnovsky, S. J., 1988, ‘The gains from fiscal cooperation in the two-commodity real trade model’, Journal of International Economics, 25, 111–27CrossRefGoogle Scholar
Wildasin, D. E., 1995, ‘Factor mobility, risk and redistribution in the welfare state’, Scandinavian Journal of Economics, 97, 527–46CrossRefGoogle Scholar
Wildasin, D. E. 2000a, ‘Factor mobility and fiscal policy in the EU: policy issues and analytical approaches’, Economic Policy, 31, 337–78Google Scholar
Wildasin, D. E. 2000b, ‘Market integration, investment in risky human capital, and fiscal competition’, American Economic Review, 90, 73–95CrossRefGoogle Scholar
Zodrow, G. R. and Miekovsky, P., 1986, ‘Pigou, property taxation and the under-provision of local public goods’, Journal of Urban Economics, 19, 356–70CrossRefGoogle Scholar
Zimmerman, C., 1997, ‘International real business cycles among heterogenous countries’, European Economic Review, 41, 319–56CrossRefGoogle Scholar

Save book to Kindle

To save this book to your Kindle, first ensure [email protected] is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

Available formats
×