The politics of welfare state recalibration in continental and southern Europe

Abstract

This thesis argues that the politics of welfare state change do not follow the same dynamics as during the Golden Age. Post-industrialization, occupational change and the emergence of new social risks have considerably complicated partisan politics of the welfare state. Social democratic parties do not anymore pursue a clear strategy of welfare state expansion. Instead, they have changed their reform strategies over time depending on the relative electoral weight of different constituencies within their party. I argue that two crucial divides run right through the heart of the social democratic coalition: an occupational divide between the working class and the middle class and a social risk divide between labor market insiders and outsiders. In times of austerity, these divides become an issue of conflict pitting different constituencies within the social democratic coalition against each other. Relying on survey experiments, the thesis establishes in a first step the micro-level foundations of the argument and demonstrates that occupational classes and insider/ outsiders have distinct social policy preferences and priorities. Drawing on a self-collected database on all enacted labor market reforms in Continental and Southern Europe from 1990 until 2016, the thesis proceeds with an assessment of the multidimensional nature of labor market reforms and shows that economic, institutional, and simple partisanship explanations are insufficient to account for the variation in labor market reforms. The final part leverages the profound transformation of party electorates over time with a new measure on the electoral relevance of different constituencies within the social democratic party and combines it with the labor market reform data. Contrary to much of the literature, the results show that social democratic parties do neither uniformly follow a strategy of social investment nor do they always implement pro-insider policies. Instead, the electoral relevance of different constituencies is consistently related to labor market reforms under social democratic governments. A higher electoral relevance of the working class is related to more protection-oriented labor market reforms, whereas a higher electoral relevance of labor market outsiders leads to more pro-outsider labor market reforms. Overall, the thesis shows a remarkable responsiveness of social democratic parties to their voters’ demands and has important implications for the electoral fate of social democracy and our understanding of policy-making in post-industrial societies.