Rediscovering social investment in developmental welfare state ...

R E D I S C O V E R I N G S O C I A L I N V E S T M E N T I N D E V E L O P M E N T A L W E L F A R E S T A T E P O L I C I E S :
B A C K T O T H E F U T U R E
One possible consequence of not resolving the ambiguity surrounding the social investment
function of welfare states is that we may see the social investment approach as a new and
discontinuous paradigm where one mistakenly identifies specific or discrete social policies as
singularly productive, fostering their instrumentalization as either active or passive. Such a
disembedded approach overlooks the need to explain why the social policies of some countries have
worked as successfully as they have for as long as they have. It is only by working out a political
economic explanation for the social investment function of welfare states that social investment can
be understood as fundamentally more than a new approach or pallid Third Way version of social
policy (Esping-Andersen, 2002). There is a distinct need to move beyond acknowledging the
possibility of market failures and vague calls for government intervention and return to affirmative
engagement with both the productive possibilities of traditional social policy and the inherent limits
of the market. 3
Arguably there have been three generations of crossnational welfare state research but the progress
of an emerging fourth generation (as I define it below) is constrained by a lack of theoretical
guidance. Ongoing research continues to remain focused on the protective effects of social policy (in
terms of outcomes related to poverty and inequality), which restrains the field‘s ability to explain
the—often unintended—productive or social investment function of social policies. I will suggest
below that much of this inability can be traced to the fact that little dialogue has historically occurred
across the division of labor between poverty research and welfare state research (De Janvry &
Kanbur, 2006). 4 While the discourse pointing toward the potentially productive effects of social policy
has been growing, it remains programmatically impressionistic and vague, offering little theoretical
guidance for thinking predictively about social policies (not simply those that are new but especially
those that are old).
This ambiguity in the social investment debate has been linked to ―the welfare regime inspiration‖
and confusion about ―ensuing policy choices‖ (Antonucci, 2010, pp. 2, 1). I argue both that scholars
have to relinquish their dependence on the regime typology approach and that the largest share of
social investment is already being undertaken by particular types of traditional (or old) social policies,
which I define below as DWSPs. 5 Regardless, Antonucci and others are correct to caution that until
social investment is theoretically clarified as an empirical concept it is difficult (in addition to being
unwise and risky) to use it as a basis for suggesting policy changes. Social investment remains
plagued by theoretical ambiguity both in terms of what it means and how it translates into social
3 The prevailing, largely ambiguous economic position on the role of government can be thought of as the second-best
position (Lipsey, 2007) that has subsumed older theoretical traditions that preceded much formal economic theory. This
notion will be discussed briefly below. See Johnson (2010) for more detailed discussion.
4 As Cantillon, Van Mechelen, and Van den Bosch (2004) explain: ―Less is known about the links between welfare state
arrangements and outcomes than about each of these separately. An important reason for the relative lack of studies on
this issue is that studies of welfare arrangements and of well-being outcomes employ different data, very much different
analytical methods, and therefore tend to be carried out by persons with little contact with one another‖ (p. 6).
5 Typologies tend to achieve generalizability by, to some degree, neglecting policy details. Arts and Gelissen (2002, p.
139) write: ―typologies are only fruitful to an empirical science that is still in its infancy.‖ They continue: ―a better
formulation of the theory on which it [the welfare state typology] is based deserves priority. Only then can predictions be
logically—instead of impressionistically—deduced from theory (p. 155).‖ Regime modeling has focused on what welfare
states are in the context of why they emerged, expanded and persisted. The why questions pursued by researchers
(Baldwin, 1996) have arguably been based on a narrow theoretical foundation (Boje, 1996) suited to a particular
historical context. Reliance on functional and sociopolitical theoretical frameworks (Van Voorhis, 1998, 2002) has
resulted in a focus on explaining independence from the family or market, redistributive effects, citizen attitudes, and the
like. I argue that something different is needed: a developmental rationale for social benefits.
C E N T E R F O R S O C I A L D E V E L O P M E N T
W A S H I N G T O N U N I V E R S I T Y I N S T . L O U I S
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