In this chapter, I explore the welfare state impacts of international capital mobility in the corporatist conservative welfare states of continental Europe. First, I consider Austria, Belgium, France, Germany, and Italy as a group and then provide analyses of internationalization and social policy change in Germany, France, and Italy. Germany is often regarded as an exemplar of the “corporatist conservative,” or Christian Democratic, welfare state and I supplement the analysis of secondary material with interview and other primary data. Given the relatively large size of the French and Italian welfare states and the centrality of the French and Italian economies, I also provide individual case studies of these countries.

I proceed with analysis of the conservative welfare states in the same fashion as I did for the Nordic cases. After an overview of basic features of welfare states, I examine, in turn, trends in international capital mobility and the politics of social welfare reform within individual countries. I conclude with a comparative analysis of the roles of internationalization in influencing social welfare policy change and an assessment of the ways in which national institutions shape the social policy impacts of globalization. As to key hypotheses, globalization theory predicts that we should observe clear evidence of retrenchment subsequent to rises in international capital mobility in the relatively generous and expensive corporatist conservative systems of social protection. On the other hand, my alternative theory argues that we should see differential effects of internationalization across varieties of national political and welfare state institutions.