1. MGTECON 580: Class 8
Is there a new European Model of a Reformed Welfare State ?
Old model of European Welfare
Welfare pillar
High value of security in job,
High replacement ratio (if nevertheless lost)
Structural change in existing firms
Comprehensive coverage health, pensions, education, leisure, environment, equality in objective function
Policy pillar
Industrial policy for large firms,
Encouraging of cooperation or mergers,
Subsidies for ailing firms
Examples
Steel cartel,
Shipbuilding subsidies,
Textile/paper industry support

2. The new model of leading four countries
Welfare pillar
No right to keep existing jobs
Right to get assistance to get a new job
Right to get training
Flexibility for firms and for employees
Coverage with personal obligations
Willingness to work may depend on life cycle position
Policy pillar
Efficiency and growth are absolutely necessary
Fiscal orthodoxy,restraint is necessary
Research, education, new technologies are the basis
Enforce current strength (cluster policy, regional strength)
Examples
Part time work as a right in Netherlands
IT Bridge and medical cluster in Denmark
Telecom sectors and IT government in SF and S
Conclusions: Welfare state should not be dismanteled
Maybe its comprehensiveness (this varies across countries)
Result is fastly decrreasing government share, moderately decrease
Consensus is currently endangered in Netherlands, Denmark by far right parties