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

Marx implied and I totally support this view. not to speak about macroeconomic changes such as the business cycle.. 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. firstly physically and later more economically. and the fiercer the competition. According to Mr. As commodities. and atomized. 2 Esping-Andersen. commodity is easily destroyed by even minor social contingencies. p. 145 3 Tolstoy. As commodities. commodification of labor implies alienation and leads to stratification of society. The Three Worlds of Welfare Capitalism. 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. From the economic side it is a type of mixed economic system. where the social benefits to individuals are achieved through redistribution of taxation. 1990. the author of a famous book The Three Worlds of Welfare Capitalism. and were more or less under his patronage. their capital. i. Espring-Andersen. 150 p. 1884-1886.system it is tasked to realize the principles of equality of opportunity of distribution of wealth. easily redundant. 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. entailing 1 Indeed. whether you call them feudalists or capitalists. tools of producing goods and the finished results of their work they came to depend on those enslaving them. What shall we do?. Elpidina.2 The same ideas were expressed by the Russian writer and philosopher. From that very moment when workers were deprived of their resources like land.1 Social rights is indeed an important element in the welfare state system. people are prisoners to powers beyond their control. Leo Tolstoy. de-commodification takes place when work is done as a matter of right and not a necessity. with the introduction of social rights (understood in modern context) loosening of the pure commodity status of a worker becomes possible. L. from this perspective authoritarian regimes like that in the former Soviet Union may hardly be called a welfare state in its meaning. such as illness. they will by definition compete. Polity Press. 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. no welfare state is actually possible without social dimension. 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. G.e. workers are replaceable. and public responsibility for those unable to have it otherwise. If workers actually do behave as commodities. At the same time. .3 In this way. the cheaper the price.

without potential loss of job. The second characteristic of the welfare state. though this was not a primary rationale behind its creating.0 United States 13. Polity Press. according to Esping-Andersen. de-commodification strengthens the worker and weakens the absolute bargaining power of the employer. The Three Worlds of Welfare Capitalism. Hence. Germany was a pioneer in social insurance at Bismarck times. they are difficult to mobilize for a coordinated action. as the fear to lose a job and leave his family without any means of survival is usually bigger than fighting for universal principles. though it is also relatively limited.1 Canada 22. is compulsory state social insurance. income.3 United Kingdom 23. For instance. maternity and parental leave as well as educational leave. paid vacation and finally pension would be good examples of how de-commodification manifests today. as most if not all benefits depended almost entirely on contributions. Table 1 – De-commodification of workers in 1980* De-commodification score Australia 13. but not always blue-collar workers and less educated personnel. thus in some respect it was like a vicious circle. and thus on work and employment. civil servants.4 Italy 24. p. When people completely depend on the market. who made a comparative cross-country analysis for eighteen developed OECD economies in 1980.21 5 Nowadays these academics. and higher-echelon white-collar employees enjoy such benefits.5 Now. however. and it is not surprising that there seems to be the lack of enthusiasm of employers on this issue.8 New Zealand 17. but for a very long time it could hardly be said to have brought about much in social programs.0 Ireland 23. indirectly deviating from de-commodification. 1990. the mere its presence does not necessarily mean its automatic utilization and therefore de-commodification. Sick insurance and unemployment insurance.. The data will be presented from Espring-Andersen results of research. G.1 4 Esping-Andersen. let us have a look at some statistical information regarding decommodification in different countries. opt out of work when they themselves consider it necessary 4. both in scope and application. .that citizens can freely. Securing the de-commodification right is the utmost task of the welfare system. or general welfare.

while the Scandinavian countries are at the top.6 As seen from the table. the number of weeks of employment required prior to qualification. the higher the degree of de-commodification De-commodification included three basic features of social protection: pensions. Old-age pensions consider minimum pension benefits for a standard production worker earning average wages. in the end. the aggregate results were obtained.1 France 27.1 Mean 27.1 Norway 38. sickness and unemployment security. This is the case for AngloSaxon nations where individualism and the market are superior to collective 6 Esping-Andersen. p. Polity Press.Japan 27.e. medium to high and high degree of commodification. de-commodification seems to be relatively low. 7.1 Belgium 32.. and the number of waiting days before benefits are paid. 1990.7 Finland 29.2 S.4 Netherlands 32.5 Germany 27. and individual’s share of pension financing. 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. The Anglo-Saxon nations are all concentrated at the bottom of the index. however some of them like Belgium and the Netherlands. i.7 * The bigger the score. In an attempt to explain this positioning of different countries. contribution period in years. Continental European states are located in the middle. Sickness and unemployment programs include benefit replacement rates (net) for a standard worker during the first 26 weeks of illness/unemployment. standard pension benefits for a normal worker.2 Switzerland 29. fall close to the Nordic states.3 Sweden 39.4 Denmark 38.37 . D. countries tend to group into three normative categories: low to medium. G. The Three Worlds of Welfare Capitalism.8 Austria 31.

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

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

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

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

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

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

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