The Myth of the Frozen Welfare State and the Dynamics of Contemporary French and German Social-Protection Reform

Abstract

This article explores the dynamics of French and German welfare-capitalist adjustment since the early 1990s. As opposed to the prevailing thesis that the French and German welfare states are politically and economically 'frozen', it contends that both countries have witnessed major political and policy adjustments changes during the past decade. In order to capture the dynamics of these changes, it suggests, we must extend our analysis beyond the welfare state, measured through social spending, to a broader notion of welfare capitalism, including social and labor-market policies and their linkages with the national political economy. The article develops this theoretical argument through a detailed analysis of recent reforms of French and German pensions and labor-market policies, two critical components of the two countries' welfare-capitalist systems.