The welfare state has become the topic of much research. Answering the
questions of how the growth in Western Europe became possible in the postwar period and whether or not it is possible to repeat this experience, with
necessary adjustments, remains a question for many developing states.
Some claim that a welfare state is a new step in the capitalist development,
while others believe it is nothing more than preservation of the status quo.
At the same time, there seems to be no universal model of a welfare state,
and each case is different, despite the similar characteristics.
As a result of social unrest subject to poor economic and labor conditions in
the end of the nineteenth century and later as a result of the Great
Depression, it became clear how vulnerable and insecure the average citizen
has been. Among the pioneers to secure the citizen’s well-being were
Germany, all of the Nordic countries, the Netherlands, Uruguay and New
Zealand and the United Kingdom. A substantial contribution to the spread of
these policies was made by the United States after the World War II under
the Marshall’s plan.
Today the “club” of welfare states is much bigger than in early times and it
includes most of developed and even some developing countries. In the
framework of this paper a special interest represent the post-Soviet countries
and Ukraine in particular. Like other communist states in the Soviet time, it
was characterized by strong but disproportional social development. The
classical term of the welfare state could not be applicable to Ukraine,
because social and economic rights were not always if at all accompanied by
the civil and political rights, both in theory and especially practice.

The paper discusses the meaning of the welfare state and considers its
evolution. A special emphasis will be given to the existing models and
possibility of their implementation in modern Ukraine. To identify that an
analysis of political and economic environment will be made.
Part I – theoretical background of the welfare state
What is a welfare state?
The amount of literature which directly or indirectly deals with aspects of the
welfare state abounds, however there seems to be no clear and finished
definition of what a welfare state actually is. In its essence it involves state
responsibility to secure some basic modicum of welfare for its citizens, and in
the word “basic” or degree of actual wealth distributed people (as well as
how), future differences between different models of welfare states will arise.
Technically speaking a welfare state is a pattern of government policies
where the state plays a key role in the protection and promotion of the
economic and social wellbeing of its citizens. Unlike the free market
economy, where the government is simply a watchdog, in the welfare state

de-commodification takes place when work is done as a matter of right and not a necessity. and when a person can maintain a livelihood without reliance on the market. and among all social rights the right to de-commodification of an employee seems to be the most important. From that very moment when workers were deprived of their resources like land. easily redundant. workers are replaceable. 1990. Elpidina.. no welfare state is actually possible without social dimension.. the author of a famous book The Three Worlds of Welfare Capitalism. their capital.2 The same ideas were expressed by the Russian writer and philosopher. 1884-1886. L. commodification of labor implies alienation and leads to stratification of society. and were more or less under his patronage. whereas with monetization of labor no responsibility from the former feudal was there and the existence of people came to depend exclusively on the market and luck. Marx implied and I totally support this view. The problem of commodification lay at the heart of Marx’s analysis of class development in the accumulation of capital: depriving workers of their labors turned them from independent producers into wage-earners having no property. As commodities. 150 p. p. i. As commodities. 145 3 Tolstoy.3 In this way. they will by definition compete. At the same time. According to Mr. At the same time it was not until the moment that workers’ survival became dependent on cash nexus that one could speak of his commodification. G. and public responsibility for those unable to have it otherwise. and the fiercer the competition. commodity is easily destroyed by even minor social contingencies. The Three Worlds of Welfare Capitalism. He accurately points out that a big difference between the former feudal system and the new capitalist one lies in the fact that feudal workers were provided with minimum conditions of sustaining life. and atomized. whether you call them feudalists or capitalists.e. If workers actually do behave as commodities. Polity Press. with the introduction of social rights (understood in modern context) loosening of the pure commodity status of a worker becomes possible. 2 Esping-Andersen.1 Social rights is indeed an important element in the welfare state system. . such as illness. From the economic side it is a type of mixed economic system. the cheaper the price. firstly physically and later more economically. Espring-Andersen. entailing 1 Indeed. people are prisoners to powers beyond their control. What shall we do?. Leo Tolstoy.system it is tasked to realize the principles of equality of opportunity of distribution of wealth. where the social benefits to individuals are achieved through redistribution of taxation. not to speak about macroeconomic changes such as the business cycle. tools of producing goods and the finished results of their work they came to depend on those enslaving them. from this perspective authoritarian regimes like that in the former Soviet Union may hardly be called a welfare state in its meaning.

they are difficult to mobilize for a coordinated action. Germany was a pioneer in social insurance at Bismarck times. however. and thus on work and employment. Polity Press. G. For instance. but for a very long time it could hardly be said to have brought about much in social programs. The data will be presented from Espring-Andersen results of research. as the fear to lose a job and leave his family without any means of survival is usually bigger than fighting for universal principles. 1990. the mere its presence does not necessarily mean its automatic utilization and therefore de-commodification. paid vacation and finally pension would be good examples of how de-commodification manifests today.21 5 Nowadays these academics. income. opt out of work when they themselves consider it necessary 4. but not always blue-collar workers and less educated personnel.0 Ireland 23. Table 1 – De-commodification of workers in 1980* De-commodification score Australia 13. though it is also relatively limited. is compulsory state social insurance. de-commodification strengthens the worker and weakens the absolute bargaining power of the employer. thus in some respect it was like a vicious circle. .that citizens can freely. When people completely depend on the market. both in scope and application. The second characteristic of the welfare state. Securing the de-commodification right is the utmost task of the welfare system.1 Canada 22. and higher-echelon white-collar employees enjoy such benefits.5 Now. Sick insurance and unemployment insurance. or general welfare. according to Esping-Andersen. though this was not a primary rationale behind its creating. p. who made a comparative cross-country analysis for eighteen developed OECD economies in 1980. The Three Worlds of Welfare Capitalism.0 United States 13.. let us have a look at some statistical information regarding decommodification in different countries.8 New Zealand 17.4 Italy 24.1 4 Esping-Andersen. civil servants. maternity and parental leave as well as educational leave. and it is not surprising that there seems to be the lack of enthusiasm of employers on this issue.3 United Kingdom 23. as most if not all benefits depended almost entirely on contributions. without potential loss of job. indirectly deviating from de-commodification. Hence.

4 Denmark 38. Old-age pensions consider minimum pension benefits for a standard production worker earning average wages. D.2 S.3 Sweden 39.8 Austria 31. where social democracy seems to play no major role. it is visible enough that countries where strong labor unions have no waste cooperation with the regime.1 Belgium 32. while the Scandinavian countries are at the top. G.2 Switzerland 29.Japan 27.7 * The bigger the score. and individual’s share of pension financing. countries tend to group into three normative categories: low to medium. standard pension benefits for a normal worker. contribution period in years.e. This is the case for AngloSaxon nations where individualism and the market are superior to collective 6 Esping-Andersen. fall close to the Nordic states.37 . however some of them like Belgium and the Netherlands.1 France 27.7 Finland 29.1 Norway 38. The Three Worlds of Welfare Capitalism.6 As seen from the table. 7. Polity Press. Continental European states are located in the middle. medium to high and high degree of commodification. p.5 Germany 27. In an attempt to explain this positioning of different countries.1 Mean 27. The Anglo-Saxon nations are all concentrated at the bottom of the index.4 Netherlands 32.. 1990. de-commodification seems to be relatively low. the number of weeks of employment required prior to qualification. i. and the number of waiting days before benefits are paid. sickness and unemployment security. the aggregate results were obtained. Sickness and unemployment programs include benefit replacement rates (net) for a standard worker during the first 26 weeks of illness/unemployment. the higher the degree of de-commodification De-commodification included three basic features of social protection: pensions. in the end.

and d) a specific type of a state – i. a relatively advanced democracy which has outgrown early stages of the wild capitalism. i. In the after-war period of 1950s onwards. Different models of a welfare state We have understood how the welfare state has evolved. is why and how possible? Why did the ruling elites agreed to cater a greater part of welfare to the masses? Who and what received as a result of this ‘generosity’? Is it going to last long? Let us try to give some answers on these questions together. Indeed. . At the same time.. and not an act of good will.e. Now we will address these differences in greater details. and the effect of their work is not easy to witness. then in the second half of the twentieth century it was an institutionalized ideological order of communism as a primary enemy and not care for demands of the people. The necessary conditions for a welfare state to spread were: a) perception of the communist threat. Causes and conditions for a welfare state As everything in history a welfare state must be understood in its historical context. who took every chance to undo what has been by their former colleagues. but not an individual. Thus. some of the states like Germany and Austria have had more corporate conservative culture in the past. however by itself it is a general concept. there is a visible shortage of empirical cases suggesting that industrial working classes ever had the voting strength. meaning they had at least 50% in highest legislative bodies to determine national policy making. fundamentally the same rationale lay behind the mass spread of the welfare state. with the church “taking care” of a family unit. the superpower country able to finance the introduction of the welfare benefits at early stages. relatively recent successful experiments of social democracy in Nordic states does lead to a greater financial freedom. with Sweden leading the score. which encompasses different types or models of development. Leftist governments nearly always required a coalition of various social groups to expand welfare policies. b) demographic changes – a sharp increase in the old age population as a result of war. If in the nineteenth century the enemy was an emerging collective effort. Earlier we have already seen that different states had a different degree of de-commodification of labor force. The two most important questions I continue asking myself with respect to this theme.e. Finally. combined with the subsequent baby-boom in the 1950s and 1960s. as after the first term they could be easily put away by their opponents. c) availability of the ‘uncle Sam’. coming from both historical differences and specific conditions at a particular time. a welfare state was created of fear and interests to preserve the elites’ position. within social democracies there are differences too. It is an evolutional phenomenon subject to a compromise and not a revolutionary change.well-being.

much more influential than that of the chaos of markets. because this is an extremely hierarchical order. like MA. Such public insurance funds were established and operated either by the government or. where under circumstances of a man only working a wife could gain access to these benefits only through her husband. At the same time. the system is very much dependent on the labor force employment and an aging population. and sought to suppress any democratic initiative. While being formally independent. . will surely notice a lot of titles standing before the name of a person. so-called corporatist welfare states developed. it was nationalistic and anti-revolutionary.According to Prof. Conservative political economy evolved in reaction to the French Revolution and the Paris Commune. achieved through social insurance funds (old age pension. accident insurance). health. white collars. The most prominent example of this regime would the German welfare model of Bismarck. etc. In the top of the corner is a family unit. help from the state would only come if the means and possibilities of a family are exhausted. run by labor associations. civil servant. and every nation shares characteristics inherent to more than one “classical” model. Doctor Anna Schmidt. we have to bear in mind that they never existed in a pure form. Those who come to Austria.. the regime gives little if anything to an individual. In continental Europe where the influence of the Catholic Church and of the authoritarian conservative state was historically strongest. not earlier7. such associations enjoyed a public status. Moreover. A state usually has a superior role. Still further. which descended from the medieval guild system and 19th century mutual aid societies. The Conservative Welfare Model. meaning that contributions to these funds are mandatory and usually deducted from payroll. there are three main models of a capitalist welfare state: - Conservative or Corporatist Welfare Model – evident in the continental Europe - Liberal Welfare Model – popular among Anglo-Saxon nations - Social Democratic Welfare Model – mostly practiced by the Nordic states When speaking about different model. Esping-Andersen. blue collar. but from discipline. unemployment. Prof.. maintaining order and status is of utmost importance. an efficient production system comes not from competition. i. In conservative welfare states. In this model. depending on the status of the labour associations. If they tolerate democratic 7 Hierarchical order also implies quite varying social benefits for different kinds of employees. as in Germany and Austria. which both can deplete funds rapidly.e. where the last would have the most privileged status.

Benefits increase as contributions increase8 However. M. Besides. The main advantages of the Conservative Welfare State are as follows: . in the long run.It maintains and reinforces social cleavages . Welfare Systems in Europe and the USA: Conservative Germany Converging towards the US Model?. 2013 9 Ibid. In this way. In this model leftist parties hardly come to influence state policies. however all of them were agreed prosperity is to be reached with a maximum of free markets and a minimum of state interference.It enjoys high level of public support . in health care) . In its pure form the liberal model excludes the majority of population from enjoying welfare benefits. the model has quite a few drawbacks as well: . will likely be not secured enough . despite a strong labor union representation. unsustainable: poor services to poor and politically marginalized population segments mean high social unrest. Liberal political economists were hardly of one mind when it came to policy advocacy. Nassau Senior and later Manchester liberals emphasized the laissez-faire element in Smith. carrying a negative public stigma. which makes welfare programs politically unpopular and.g.It supports private service system without rationing (e. The state here generally encourages the market to act as a co-provider of benefits. It usually delivers benefits to a very low income working class representatives.It drives up labor cost (payroll taxes) and low wage unemployment . based on public services or insurance schemes.It often provides few benefits for those outside the insurance model9 Liberal Model of a Welfare State. partly by providing a low levelof public services.. the end of the social order would come soon.It is sensitive to employment conditions and demographics . . it tends to create a two-level society. The 8 Seeleib-Kaiser. non-traditional and/or flexible jobs. The liberal welfare regime is characterized by means-tested programs and modest universal benefits. which will probably provide higher quality and stigma-free health care and pension benefits.It allows benefit recipients to maintain their level of income . social dependents will be much encourage to opt for employment.Those occupied in new. rejecting any form of social protection outside the cash nexus.mass participation and allow authority and status boundaries to dissolve..

Social democracy has been the dominate political force in developing this universalistic welfare state that pervades all aspects of people's lives. and regulation of the economy in the general interest. differentiated services 10 European Welfare States: Information and resources. How to Conceptualize the Welfare State.It has relatively low taxes .pitt. The individualization of agriculture was an intervention by the Crown and it implied the weakening position of the nobility that gradually turned into an urban and bureaucratic elite. cooperation between working and peasant class. collective bargaining arrangements. The model implies a relatively high degree of public awareness and social responsibility. The social democratic welfare state emerged as a result of a class alliance between the industrial working class and the small holders (a red-green alliance in the interest of full employment and farm price subsidies). http://www.High benefits. the state has.Universality encourages support of population . for it would be likely to politicize the distributional struggle. through progressive income and value-added taxes. while ensuring the highest possible level of service. thus fighting substantial stratification of society. but mostly in low-skills sector10 Drawbacks of the model have already been listed. Instead of providing the benefits to the poor. 2012.liberals rightly feared universal suffrage. but not exclusively. The main advantages of the Nordic system are as follows: . in fact. It supports economic and social interventions to promote social justice within the framework of a capitalist economy. The liberal model might still have positive sides: . The Social Democratic Model. pervert the market.It ‘stimulates’ job growth. Retrieved 28 July 2015. the liberals were hardly eager to extend social which should result in the dominant role of leftist parties in politics. and includes the instruments of state provisions. Because a high level of public services is achieved. In addition.It is the least sensitive to demographic changes in the population .html . crowded out all private competition. the Scandinavian welfare state tends to reduce class and income differences. it lifts them to the level of the middle class. It is achieved primarily. Therefore. and fuel ‘inefficiencies’. The necessary preconditions for an almost dreamy model like this are liberal tradition with great regard for individualism and equality.

so that a relatively small share of income would suffice for a decent living. Cambridge. several agencies such as National Agency for Social Insurance and local municipalities are responsible for redistribution of about 48% of the Swedish GDP in the form of taxed income. 12 The Swedish Government official website. 1997. responsible for the smooth functioning of the system: the Ministry of Health and Social Affairs. 2. it requires high tax burden. the phenomenon common in all agricultural societies of the past and seen in many developing countries nowadays. strong government orientation and a relatively mature society. assistance to disabled people etc.1) seems to have a more classic pattern. The social welfare part includes but is not limited to financial security in the case of illness. Economy should be advanced too. with a lot of younger people successively tapering off with increasing age to a pointed top. In education. the share of the population over 65 years old more than doubled. old age and for the family. p. when the share of elderly has more than doubled. By and large. social services such as health care for adults and children. reaching 17% by the end of the century. education and employment. there are government bodies.regeringen. and the Ministry of Employment 12. New York. Population ageing as a background for the modern welfare system Sweden has been experiencing population ageing over more than 100 years. Manfred B.. USA: Cambridge University Press. The population pyramid in 1900 for Sweden (see Fig. In this regard. each of the three is mostly funded by taxes (at the central and local levels) and utilized by the public sector. Given existing obstacles in elderly care as well as healthcare in general. this system may be difficult to operate. This lead in turn to a 11 Steger. the question is how Sweden will cope the increased population and sustain economic growth at the same time. the welfare focuses mainly on providing pre-school services and childcare for schoolchildren as well as adult education. In the twentieth century.Positive employment effects . UK. of the Ministry of Education and Research. . which are the social welfare. Social welfare in Sweden The welfare system in Sweden is composed of three main parts. http://www.Reduced social cleavages11 However. The Quest for Evolutionary Socialism: Eduard Bernstein And Social Democracy. England.

the phenomenon when higher fertility rates lead to larger generations. A. 83–89. the age structure would mostly have been the identical in 1950 as in 1860. Population ageing .changing pyramid from traditional to the more urn-shaped age structure. received the name as positive population momentum. had fertility rates remained the same. 22. One of the reasons why the share of t h e elderly increased is that life expectancy increased and people are living longer.”14 Thus. 13 Coale. Yet the main reasons for population ageing is considered the declining fertility... one may expect negative population momentum. Bengtsson and K. has been the engine of population ageing may appear contradictory. 14 Bengtsson T. Cold Spring Harbor Symposia on Quantitative Biology. pp. Ch. 11 . 2010. Truly so. the fact that fertility. 1957. 2. T. In his work. according to A. It is nevertheless important to make this distinction. between the fact that life expectancy increases and the fact that the share of elderly in the population increases. p. especially in light of the dramatic increase in life expectancy experienced in industrialized countries.1 – Population Pyramid for Sweden Source: BiSOS and Befolkning (Statistics Sweden) Indeed. How the age distribution of a human population is determined. and not mortality. Coale. when the otherwise effect takes place. Fig.. despite substantial increases in life expectancy during this period. up to the 77 and 82 years correspondingly in 2000. with a smaller base and wider top. he demonstrated that the population ageing occurred in the first half of the twentieth century was almost entirely the consequence of fertility drop13. Scott imply that “it is easy to confuse population ageing with individual ageing.a threat to the welfare state? The case of Sweden. with projections for further increases to 83 and 86 years by the year 2050. J. Demographic Research Monographs. Indeed. 2. Scott C. life expectancy at birth in Sweden has increased from 35/38 for men and women respectively in 1750.

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