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Meagre Collective of Country-specific Social Models Arjan Lejour

Meagre Collective of Country-specific Social Models Arjan Lejour. European Social Policy. 1957 Treaty of Rome Closer cooperation 1974 Social Action Programme Equal treatment of men and women, employment laws, working conditions 1986 Single European Act: qualified majority

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Meagre Collective of Country-specific Social Models Arjan Lejour

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  1. Meagre Collective of Country-specific Social Models Arjan Lejour

  2. European Social Policy • 1957 Treaty of Rome • Closer cooperation • 1974 Social Action Programme • Equal treatment of men and women, employment laws, working conditions • 1986 Single European Act: qualified majority • 1989 Social Charter • 1992 Treaty of Maastricht: • Subsidiarity Principle • 1997 Treaty of Amsterdam • Social Chapter ratified by all Member States • European Employment Strategy • 2000 Lisbon Summit

  3. European Social Model? • In a sense, there is a European Social Model: • Idea of solidarity is firmly embedded • Shared belief that Social cohesion can be a productive factor • Institutionalised dialogue between government and social partners • However, huge differences in welfare states in Europe

  4. EU Social Acquis (see Pelkmans)

  5. First conclusion • Primary role in social models is for MS • budget • regulation • So Europe is social by MS policies. • What is the rationale for division is tasks between MS and EU • use subsidiarity principle • What are the challenges and threats? • Does this require shifts in tasks?

  6. How to divide the tasks? • Treaty definition and shared competences • The Subsidiarity Principle: • Arguments pro Decentralised policy • Diversity • Local preferences • Arguments pro Centralised policy • Scale Effects • better insurance • lower costs implementation • External effects • social dumping • migration

  7. Epsing – Anderson classification

  8. Welfare States in Europe

  9. Trade-off? Employment Inequality

  10. Trade-off? Production-Inequality

  11. Scale effects? NO

  12. Social dumping? NO

  13. Second conclusion • No economies of scale • No external effects (hardly) • Yes diversity • Current division of tasks between MS and EU is largely OK • No reason to centralize at least. • Will this also be the case in future?

  14. Pressure on European welfare states wage inequality ageing welfare state heterogeneity mobility tax bases

  15. Three Rs of welfare states • Redistribution • Risk and insurance • vs moral hazard • Redistribution over life cycle • Ageing, wage inequality, heterogeneity and mobility tax bases affect them all ... • and differently in MS.

  16. National challenges • Retreat or reform? • retreat: Anglo-Saxon • reform towards Scandinavian • depending on preferences • Or need for larger even welfare state to cover risk of external shocks (Rodrik story)? • more open countries have bigger governments • Ageing, wage inequality and heterogeneity threaten distribution/solidarity in each MS • but EU-solidarity is limited, mainly national solutions.

  17. Reforms • Redistribution: subsidies to increase female participation, individualized tax income system, subsidize employers for low-skilled labour. • Risk and insurance: ALMP, employment protection • redistribution life cycle: life-long learning, higher female participation, more flexible labour markets for elderly.

  18. Role of EU • Incentive structure like OECD • Coordination and information and policy exchange • Dealing with tax competition if necessary! • Dealing with labour mobility issues and consequences of different social models • subsidies • one shop idea • Still mobility will be hampered by differences in social models, but this is a choice. • ... immigration scheme to affect active/inactive ratio ... or let Turkey in!

  19. Final conclusions • EU role is limited, mainly some coordination and general rules. • Chunk is national in particular on budgetary items, social model are types rooted in national traditions. • But social models have to be reformed due ageing wage inequality, heterogeneity, mobile tax base. • These are mainly national challenges. • Role of EU is supplementary.

  20. as expressed a long time ago

  21. Literature • Pelkmans, 2007, How Social is European Integration?, BEEP paper. • CPB/SCP, 2003, Social Europe, European Outlook 1. • De Mooij and Tang, 2003, Four Futures of Europe, CPB. • De Mooij, 2006, Reinventing the Welfare State, CPB. • Sapir, 2005, Globalisation and the reform of European Social Models, Bruegel policy brief • CPB contribution in EFN, 2007.

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