Utopia or dystopia? Well-being in the Nordic welfare states

More documents

Recommendations

Info

generosity with universality. In Central Europe benefits might be more generousbut not that universal and in the liberal or Anglo‐American model they neitherare universal nor generous (Kvist, 2007).As can be seen in Figure 1 the Nordic model had its hey‐day in the late 1980s andearly 1990s. Sweden, Norway, Denmark and Finland formed a group with highdegree of universalism and generous benefits. Reforms since then made theNordic countries remain the most universal but they lost some of theirdistinctiveness in generosity. With the exception of Norway, benefit levels insocial insurance schemes are cut and generosity is moving towards the OECDmean.Social assistance has also been reduced. Because of the other aspects of theNordic welfare model social assistance is expected to provide high benefit for asmall group of claimants. Indeed, the level of social assistance in the North usedto be high in comparison to those in other countries. However, during the pastdecade the replacement levels have been cut by about 10 percentage points. Thecuts are mirrored in the efficacy of social assistance, and consequently, povertyrates among the social assistance recipients have increased markedly – from30% in the early 1990s to 40% in the late 2000s (Kuivalainen and Nelson, 2012).The interaction of increasing unemployment and the decreasing adequacy ofsocial assistance may result in increasing poverty rates. If this trajectorymaterializes, the Nordic model prized for its low poverty is history: bigger andbigger group is living on lower and lower benefits.Increasing conditions is a new trend that has already transformed the Nordicwelfare model. So far we have examined universalism and generosity. However,this is too narrow a picture. In Scandinavia, as elsewhere, entitlements tobenefits are more and more targeted by various forms of conditions. Taking thisconditionality into account we expand from a two to a three‐dimensionalperspective as illustrated by unemployment insurance in Figure 2. First, we cansee that the replacement levels (generosity) are higher in Germany and Francethan in any other country but the coverage among the labour force(universalism) is the highest in the Nordic hemisphere. With the exception ofNorway, the Nordic countries are not significantly less conditional than France,Germany or the U.K.Figure 2. Generosity, universalism and conditionality in unemploymentinsurance in some countries, 2010.
Among the OECD countries there is a trend of increasing conditionality. In thecase of unemployment the crucial condition is the contribution period, i.e. thetime the unemployed must have been employed /a member of theunemployment insurance system before getting right to benefit. While up toearly 1990s the reference period in the Nordic countries was on average 19weeks, the number is now 30 weeks. The similar trend is visible also in theContinental Europe where the reference period has been lengthened from 37 to42 weeks. In this process the Nordic cluster has become more similar, whilethere is growing diversification among the Continental cluster. Today the Nordicwelfare model can thus be characterized as less universal, less generous andmore conditional than one to two decades ago.Inequality, Poverty & DeprivationInternational comparisons (Fritzell, Bäckman and Ritakallio, 2012) show thatthere are no major differences in factor income inequalities between developedcountries, whereas there are substantial differences in inequalities of disposableincome. The Gini‐index for factor income in the Nordic countries is about thesame as in the U.S. (Wang and Caminada, 2011: 13). However, due to theequalizing effects of taxes and income transfers the countries are placed in theopposite ends of the continuum of disposable income inequalities.The same pattern is visible in poverty levels. The poverty alleviation effect in theNordic countries is 75%, i.e. social transfers lift 75% of the pre‐transfer poor outof poverty. The numbers for the Central‐European states are about the same,while the corresponding percentage for the U.S. is less than 30% (Smeeding,2005, table 4). The story is much the same when it comes to child poverty (seeGornick and Jäntti, 2009).Social policy models thus differ in their capacity to decrease income inequalitiesand alleviate poverty. Although the Nordic welfare model has done well, the rise
Page 1 and 2: Utopia or dystopia? Well‐being in
Page 3 and 4: If we place the Nordic countries in
Page 5: The Scandinavian inclination toward
Page 9 and 10: In the Anglo‐American political d
Page 11 and 12: Portugal and Spain the poverty rate
Page 13 and 14: ates are close to those of fathers.
Page 15 and 16: y local agreements, which decreases
Page 17 and 18: References:Alber, J. (1981). Vom Ar
Page 19 and 20: Kangas, O. and Palme, J. (eds.) (20
Page 21 and 22: Appendix TablesAppendix Table 1. Th
Page 23: Appendix table 2. Poverty rates amo

Utopia or dystopia? Well-being in the Nordic welfare states

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?