Analyzing details from the case of Brazil, this chapter explores the impacts of globalization on weak dual welfare states. Specifically, the Brazilian case responds to the three core questions of this book as they apply to dual welfare states. How and why do globalization and race to the bottom pressures lead to welfare retrenchment in dual welfare states? Do cutbacks mean that dual welfare states are undergoing institutional transformation towards a neoliberal welfare state (i.e. convergence)? In dual welfare states, who really gets hurt by welfare reforms in the current era of globalization?

This type of welfare regime, as discussed in chapter 4, pursues a mixed strategy of protective and productive social policies. On the productive side, Brazil emphasizes (near-)universal primary enrollment; the quality of education is poor and gets worse at the secondary level, however. Brazil's protective schemes are focused on the provision of social security and labor market protections. As with India and South Korea, RTB pressures have resulted in cutbacks in some of its welfare programs. In contrast to the other welfare regime types, however, Brazil's welfare regime appears to be the most dynamic, in that retrenchment has occurred in some of its long-standing welfare programs with the intent of improving equity. In fact, significant changes to both the protective and productive components have occurred.

The following three chapters illustrate the findings from the previous portion of the book by selecting one representative from each cluster: a protective welfare state (India); a productive welfare state (South Korea); and a weak dual welfare state (Brazil). These case studies are intended as heuristic devices, rather than another hard test of the hypotheses in this book. The purpose of the case illustrations is to provide a more nuanced and detailed look at the primary research finding: as international market demands systematically affect government policy decisions in developing countries, distinct institutional arrangements governing the distribution of welfare persist and, as a consequence, middle-class labor groups are the ones most directly hurt by race to the bottom pressures. The country overviews essentially provide greater in-depth analysis of how national social policy configurations are structuring responses to globalization. The addition of the case study analysis allows a more applied understanding of the consequences of globalization in terms of cutbacks (RTB) and institutional changes. In addition, they permit consideration of the role of other factors not emphasized in the quantitative analysis, such as democracy.

One caveat should be kept in mind as the case studies unfold in the following chapters. Because the causal linkages have been empirically verified in the earlier chapters, I take on the broad panorama of each country's political economy and related social welfare strategies in a swift, bold, and unrestrained manner.

My interest in politics and globalization emerged in my adolescence during frequent visits to India. Time after time I saw that the immense scale of poverty and destitution remained the same. Life at home in the United States, on the other hand, seemingly held the promise of endless choices and opportunities for advancement. I was particularly struck by the stark contrast between the health care and resources available to my grandfather, a village doctor in one of the most remote and poorest “gramas” (villages) in West Bengal, and my father, an FRCS (Fellow of the Royal College of Surgeons) surgeon practicing in Florida. I was astounded that two such diametrically opposed economies coexisted in the same world. From here, eventually, questions of distribution, international economics, politics, government choices, and policy design emerged. In my early years of graduate school I became particularly intrigued by the extent to which domestic policy choices seemed constrained by the global economy, and thus fascinated with issues in international political economy. It took some further study and field experience to begin to grasp the true complexity of the situation.

This book is my attempt to scratch the surface of how and why developing and developed countries face such different challenges in (and responses to) the current era of globalization. It is a product of my struggles with understanding the distributional consequences of globalization, and questions of if and how developing country governments can respond to it.

What are the effects of globalization on productive welfare states? In contrast to protective welfare states, such as India's, are they advancing towards the neoliberal bottom? Who gets hurt from changes in welfare policies as markets expand in productive welfare states? Using details from the case of South Korea, this chapter seeks to answer these questions by illustrating how the interplay of international markets and domestic institutions shapes social policies in a productive welfare state. Just as in protective welfare states (e.g. India), globalization pressures are real and have prompted cutbacks in several of South Korea's welfare programs. At the same time, the South Korean government has also explored ways to make the productive welfare state more “protective.” The introduction of universal pensions and health insurance constitutes two examples. This is very distinct from India, a protective welfare state, where the (relatively) major path-breaking reforms have been in the “productive” welfare category (e.g. education). Despite succumbing to some race to the bottom pressures, however, the main features of South Korea's productive welfare state remain intact: promoting citizens' market reliance through extensive state intervention and a concentration of public resources on commodification, particularly education. As a result, the situation of better-off groups in society is similar for both regime types: long-standing domestic institutions essentially guarantee that the more privileged sectors will have access to protections from the risks and uncertainties associated with the globalizing environment.

Chapter 2 has established that the fragmented character of labor market institutions in developing countries makes it more likely that the governments of these nations will respond to race to the bottom pressures. Based on this evidence alone, globalization pessimists might claim that their fears are validated, and it is the end of domestic politics in the developing world; the zero-sum dichotomy between states and markets has been confirmed. But the analysis cannot stop here. What is really driving anxieties about globalization amongst academics, activists, and policy-makers is the concern that the race to the bottom hurts the poor. The fight in this case is not for (or against) domestic politics per se, but for the benefit of the less privileged.

This chapter goes a step beyond analyzing the capacity of labor to overcome collective action problems and negotiate policy compromises under globalizing conditions, and observes the effects of domestic institutional arrangements supporting government–labor relations. This approach reveals that the effects of international free-market competition are much more complex than is commonly assumed. While globalization is certainly increasing RTB pressure on less developed countries, the long-time policy interactions between government and select labor groups have engendered a set of social policies that were never designed to help the poor in the first place. Rather, the more privileged classes traditionally receive these benefits, and are therefore the immediate victims of any cutbacks.

Such is the plight of India's Anganwadi workers, a low-caste disadvantaged group of workers that assists poor mothers and children with health and nutrition needs. After working more than eight hours a day, total earned wages keep them well below the international poverty line of $1 per day. Their persistent demands for higher wages, job security, and social security have yet to be met by the Indian government. The key to obtaining these protections, the workers argue, is to be recognized as government employees instead of part-time workers.

India's Anganwadi are not alone. In the current era of globalization disadvantaged groups of workers receive minimal or no protection against market risk. Examples from around the world attest to the near-universal tenuous position of marginal workers. The Korea Herald reports that approximately 70 percent of non-standard South Korean workers receive no social insurance, as compared to 1.7 percent for standard workers. Brazilian legislation that provides social insurance and job dismissal protection exempts at least 40 million informal workers, including domestic workers, shoemakers, garment workers, and slum dwellers. These workers have begun clamoring for the same rights to unemployment insurance, maternity leave, paid holidays, and other benefits long afforded other working Brazilians. Half a world away, thousands of Bangladeshi textile workers have taken to the streets with similar demands.