Jump to ContentJump to Main Navigation
The Welfare State in EuropeEconomic and Social Perspectives$
Users without a subscription are not able to see the full content.

Pierre Pestieau and Mathieu Lefebvre

Print publication date: 2018

Print ISBN-13: 9780198817055

Published to Oxford Scholarship Online: September 2018

DOI: 10.1093/oso/9780198817055.001.0001

Show Summary Details
Page of

PRINTED FROM OXFORD SCHOLARSHIP ONLINE (oxford.universitypressscholarship.com). (c) Copyright Oxford University Press, 2020. All Rights Reserved. An individual user may print out a PDF of a single chapter of a monograph in OSO for personal use. date: 26 October 2020

Welfare State and Economic Efficiency

Welfare State and Economic Efficiency

(p.78) 7 Welfare State and Economic Efficiency
The Welfare State in Europe

Pierre Pestieau

Mathieu Lefebvre

Oxford University Press

The main purpose of this chapter is to tackle the issue of whether or not the welfare state is responsible for the decline in economic performance. At the micro level, social protection brings distortion in the choices of contributors and of beneficiaries. Yet, the empirical evidence indicates that the cost of these distortions is rather limited. At the macro level, one cannot infer much from a negative relation between the social burden and GDP growth. Given that, we reach three conclusions. First, the welfare state is likely to have modified the preferences of individuals. Second, the decline in economic growth and pressured public finance calls for its partial retrenchment. Finally, most of the work on the effect of the welfare state on growth and employment deals with a relatively short and recent period. A longer run view might be useful.

Keywords:   consumer’s surplus, corporatist economy, deadweight-loss, distortionary tax, excess burden, lump-sum tax

Oxford Scholarship Online requires a subscription or purchase to access the full text of books within the service. Public users can however freely search the site and view the abstracts and keywords for each book and chapter.

Please, subscribe or login to access full text content.

If you think you should have access to this title, please contact your librarian.

To troubleshoot, please check our FAQs , and if you can't find the answer there, please contact us .