Welfare regimes and the welfare mix

Abstract

We present a different approach to appraising welfare regimes, stressing different dimensions, variables and techniques to those used by Esping-Andersen in his path-breaking work entitled The Three Worlds of Welfare Capitalism. First, instead of focusing on social rights, we construct an alternative path to identifying welfare regimes starting from the welfare mix. Second, we incorporate active labour market policies (ALMP) as a key variable of the welfare mix. Third, we use hierarchical and k-means cluster analysis to identify welfare regimes in the data. Fourth, we compare regimes over time. Nevertheless, despite these different approaches, we conclude, like Esping-Andersen, that there are three clusters or worlds of welfare capitalism. We also find that the clustering of welfare regimes was sharper in the mid-1990s as compared to the mid-1980s, but that comparing welfare regimes in the 1980s with the 1990s indicates strong path-dependence. Faced with high and persistent levels of unemployment in the 1990s, OECD countries have adopted policies, including ALMP, which reinforce their welfare mix.