Walter Korpi

The Paradox of Redistribution and Strategies of Equality: Welfare State Institutions, Inequality and Poverty in the Western Countries

The debates on how to reduce poverty and inequality have focused on two controversial questions. One is whether social policies should be targeted to low- income groups or universal; another whether benefits should be equal for all or earnings-related. Traditional arguments in favor of targeting and flat-rate benefits, focusing on the distribution of the money actually transferred, have neglected three policy-relevant considerations: 1. The size of redistributive budgets is not fixed but reflects the structure of welfare state institutions. 2. there tends to be a tradeoff between the degree of low-income targeting and the size of redistributive budgets. 3. Outcomes of market-based distribution are often even more unequal than those of earnings-related social insurance programs. We argue that social insurance institutions are of central importance for redistributive outcomes. using new data bases, our comparative analyses of the effects of different institutional types of welfare states on poverty and inequality indicate that institutional differences lead to unexpected outcomes and generate the paradox of redistribution: The more we target benefits at the poor and the more concerned we are with creating equality via equal public transfers to all, the less likely we are to reduce poverty and inequality.

New Politics and Class Politics in the Context of Austerity and Globalization: Welfare State Regress in 18 Countries, 1975–95

The relevance of socioeconomic class and of class-related parties for policymaking is a recurring issue in the social sciences. The “new politics” perspective holds that in the present era of austerity, class-based parties once driving welfare state expansion have been superseded by powerful new interest groups of welfare-state clients capable of largely resisting retrenchment pressures emanating from postindustrial forces. We argue that retrenchment can fruitfully be analyzed as distributive conflict involving a remaking of the early postwar social contract based on the full employment welfare state, a conflict in which partisan politics and welfare-state institutions are likely to matter. Pointing to problems of conceptualization and measurement of the dependent variable in previous research, we bring in new data on the extent of retrenchment in social citizenship rights and show that the long increase in social rights has been turned into a decline and that significant retrenchment has taken place in several countries. Our analyses demonstrate that partisan politics remains significant for retrenchment also when we take account of contextual indictors, such as constitutional veto points, economic factors, and globalization.Author names are in alphabetical order and they share equal responsibility for the manuscript. Early versions of this paper were presented at annual meetings of the Nordic Political Science Association in Aalborg, 2002, and the American Political Science Association in San Francisco, 2001, the International Sociological Association RC 28 meeting in Mannheim, 2001, the International Sociological Association RC 19 meeting in Tilburg 2000, and the American Sociological Association in Washington, DC, 2000, as well as at various seminars. For constructive comments on different versions of the manuscript we thank Rainer Lepsius, Anders Lindbom, Ingalill Montanari, John Myles, Michael Shalev, Sheila Shaver, and Robin Stryker, as well as other participants in these meetings. We want to thank Olof Bäckman, Stefan Englund, Ingrid Esser, Helena Höög, and Annita Näsström for very valuable help and Dennis Quinn for providing us his data on international financial deregulation. Our thanks are also due to three anonymous referees for careful reading. This research has been supported by grants from the Bank of Sweden Tercentennial Foundation and the Swedish Council for Social Research.

Power Resources and Employer-Centered Approaches in Explanations of Welfare States and Varieties of Capitalism: Protagonists, Consenters, and Antagonists

The power resources approach, underlining the relevance of socioeconomic class and partisan politics in distributive conflict within capitalist economies, is challenged by employer-centered approaches claiming employers and cross-class alliances to have been crucial in advancing the development of welfare states and varieties of capitalism. Theoretically and empirically these claims are problematic. In welfare state expansion, employers have often been antagonists, under specific conditions consenters, but very rarely protagonists. Well-developed welfare states and coordinated market economies have emerged in countries with strong left parties in long-term cabinet participation or in countries with state corporatist institutional traditions and confessional parties in intensive competition with left parties.

Social policy and distributional conflict in the capitalist democracies. A preliminary comparative framework

The purpose of this paper is to take preliminary steps towards the development of a theoretical framework for the comparison of social policies in the industrialized nations, which combine a capitalistic economic system with political democracy. It is a part of a larger research project attempting to compare social policies in these countries against the background of the structure, organisation and relative power of their main classes and the role of shifting distributions of power between classes for the patterns and forms of class conflict in these societies.

Contentious Institutions: An Augmented Rational-Actor Analysis of the Origins and Path Dependency of Welfare State Institutions in the Western Countries

Welfare states in Western countries have shared similar goals, yet the choice of institutions to approach these shared goals has generated protracted power struggles among major interest groups and great cross-country variation in institutional structures. Relating recent debates on new institutionalism to earlier debates on power, this paper outlines an augmented rational-action approach to the explanation of the origins of welfare state institutions and of variations in their degree of path dependence. With a differentiated concept of power costs and the degree of power asymmetry among actors as a central variable, this augmented approach partly combines some salient characteristics of the rational-choice, historical, and sociological versions of new institutionalism. The augmented rational-action approach proves fruitful in understanding conflicts characterizing the emergence and change of major social insurance institutions in 18 rich Western countries since the late 19th century and up to the present. It complements rational-choice institutionalism focused on voluntary cooperation, contracts and conventions.

Conflict, Power and Relative Deprivation

The widely accepted expectation achievement approach to conflict, which views conflict primarily as a response to relative deprivation, has recently been challenged by proponents of a political process approach, the central features of which are mobilization of power resources and the struggle for power. Here a power balance model of conflict is developed which incorporates the core concepts from both approaches. In this model the difference in power resources between the contending parties is used as the central independent variable. Relative deprivation, utility of reaching the goal and expectancy of success are introduced as intervening variables to relate the effects from changes in the balance of power between the parties to the probability of manifest conflict between them. According to the power balance model of conflict different types of relative deprivation (aspirational, decremental and progressive) will be differently correlated with the probability of conflict. The overall correlation between relative deprivation and conflict is expected to be insignificant. Situations where the difference in power resources between two parties is decreasing are seen as most conducive to conflict. When the power resources of an already weaker party are decreasing, the probability of conflict is assumed to be lower than when the weaker party is gaining power resources.

The Great Trough in Unemployment: a Long-term View of Unemployment, Inflation, Strikes, and the Profit/Wage Ratio

The third quarter of the twentieth century with full employment in most Western countries is a historically unique period, forming The Great Trough in unemployment. This article analyses the beginning, continuation, and demise of The Great Trough, contrasting a supply-and-demand framework derived from economic theory with a power-sensitive approach focusing on long-term positive-sum conflicts involving major interest and reflected in unemployment, inflation, industrial disputes, and the functional distribution of national income. Comparative empirical data from eighteen countries are used in analyses of hypotheses implied by the different theoretical perspectives.

Social citizenship rights and social insurance replacement rate validity : pitfalls and possibilities

The comparative analysis of welfare states has been greatly advanced by rights-based measurements of social provisions. Social insurance replacement rates have figured prominently here. Apparently, there is considerable confusion about the validity of replacement rates and their comparability across different datasets. The purpose of this study is to outline a refined institutional perspective in the comparative analysis of welfare states focusing on the character of social citizenship rights. We show that social insurance replacement rates from different datasets differ in their underlying theoretical framework for policy analysis and therefore capture different aspects of how welfare states secure the livelihood of citizens in periods of work incapacity. Analysing validity solely on the basis of replacement rate point estimates is therefore misleading. We show that the close focus on social citizenship rights and programmatic design in the Social Citizenship Indicator Programme (SCIP) carries great potential for causal welfare state analysis.

Conflict and the Balance of Power

The role of differences in power resources between parties for manifest conflict between them is a neglected topic in conflict studies. Here a power balance model of conflict is outlined which takes the difference in power resources between two parties as the central independent variable and the probability of manifest conflict between them as the dependent variable. Utility of achieving the goal, expectancy of success in conflict initiation and in defense and relative deprivation are the main intervening variables. Predictions from the model challenge the widespread assump tion that the probability of contlict is highest when parties have equal power resources. Instead a bi-modal distribution of the probability of manifest conflict is predicted. Empirical data are discussed and the relevance of the model for exchange theories is indicated.