Austria: the ‘Island of the Blessed’ in the Ocean of Globalization 1
Austria: the ‘Island of the Blessed’ in the Ocean of Globalization 1
Austria's fundamental political transformation from an economically backward and multi-ethnic superpower to a small and wealthy democracy at the centre of Europe involved phases of democratic (1918–34), pre-fascist (1934–8), and Nazi rule (1938–45). Despite several regime breakdowns during the first half of the 20th century, the welfare state established in the Habsburg era survived political upheavals by and large unscathed. Post-war Austria, by contrast, was characterized by a considerable economic, societal, and political stability between the 1950s and the mid-1980s. In retrospect, a duopoly of pro-welfare state parties, consociational democracy, and highly developed corporatism, as well as a Federal Constitution lacking institutional veto points, provided a political configuration highly conducive to welfare state expansion during the post-war period. Rapid economic growth provided the economic means for funding the expansion of the welfare state and smoothed distributional conflict between the social partners and their allied parties.
Keywords: Austria, welfare state, Social Democrats, family policy, labour market policy, pensions, Grand Coalition, social policy
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