9 August 2019
Inequality and the Welfare State
In 2014, the average income of the bottom 90 % in the United States was about 33,000 USD. The income of the top 0.1 % was over 6,000,000 USD. In other words, the top 0.1 % received 184 times the income of the bottom 90 %. The Gini-coefficient (0 = perfect equality; 1 = perfect inequality) in the US was almost 0.4, as compared to about 0.25 in countries like Denmark and Norway. Inequality has been on the rise in most highly developed democracies around the globe, but it varies enormously between countries. Why is this?
Inequality is a fundamental feature of all human societies. Without some degree of economic inequality, it is difficult to imagine how modern democracies could function. Yet, while some inequality is unavoidable, too much inequality can have consequences that many will find unacceptable. High inequality is associated with deteriorating health outcomes, reduced social mobility and lack of democratic participation. Most people would probably agree that neither perfect equality, where all have exactly the same, nor perfect inequality, where one person owns everything, is desirable. The question is not whether there should be economic inequality, but how much there should be.
Many people spontaneously associate the welfare state with equality, reasoning that the welfare state implies income redistribution and that income redistribution means more equality. At first sight, this seems to make perfect sense. Nevertheless, the intuition that the bigger the welfare state (in terms of public social spending), the more egalitarian the income distribution tends to be does not hold. There does not seem to be a clear and strong (negative) relationship between the size of the welfare state and inequality. Why is this?
In part I of the course, we examine comparatively the history, growth, maturation, retrenchment and reform of welfare states. In part II we focus on inequality and how welfare states deal with this (or not!).
Kees van Kersbergen
EUR 690: Exchange students: No Fee
Freemovers, EU/EEA: 690 EUR
Freemovers, NON-EU/EEA: 1459 EUR
Books, course materials, social programme, and housing are not included in the fee.
No scholarships available.