Welfare Reform on the Web (November 2003): Welfare State - Overseas

WHO PAYS FOR THE "WELFARE" IN THE "WELFARE STATE"? A MULTICOUNTRY STUDY

A. Shaikh

Social Research, vol.70, 2003, p.531-550

It has been claimed that the social benefit expenditures of welfare states from the 1950s to the 1970s led to economic stagnation and persistent unemployment. Paper argues that these social benefit expenditures were financed out of taxes paid by their recipients. In other words, social welfare benefits were self-financed and could not have been a source of fiscal deficits or a drag on growth.