Can we all be Denmark? The role of civic attitudes in welfare state reforms

Abstract

Research has demonstrated the economic effectiveness of welfare state reforms that follow the Danish flexicurity model, broadly specifying the combination of highly flexible labor market policies and generous protection schemes. Notwithstanding, it has also been argued that large and generous welfare states may erode civic attitudes, defined here as people’s willingness to cheat on taxes and claim transfers to which they are not entitled. Combining data from all available waves of the World Values Survey and the European Values Study with a self-constructed flexicurity index, this paper finds that welfare state reforms involving a combination of higher benefits, lower labor market regulations, and active labor market policies are not significantly associated with an erosion of civic attitudes.