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Social policies and activation in the Scandinavian welfare model: the case of Denmark

Author

Listed:
  • Torben M. Andersen

    (Department of Economics and Business, Aarhus University, Denmark)

Abstract
Scandinavian countries are characterized by a generous tax-financed social safety net which provides insurance and performs a redistributive role. While contributing to lower inequality it may imply that incentives to work are low, and yet employment rates are high. How have the Scandinavian countries been able to reconcile social objectives with a high employment level? It is argued that the Scandinavian welfare model has a strong employment focus both because it is an important element in social policy based on social inclusion, but also because a collective welfare arrangement is only financially viable if (private) employment is sufficiently high. To ensure this, the social safety net includes a number of employment conditionalities (active labour market policies/workfare) to balance income protection with an employment focus. These policies are discussed using Denmark as an example and empirical evidence is presented. The criticism of workfare is also briefly discussed.

Suggested Citation

  • Torben M. Andersen, 2011. "Social policies and activation in the Scandinavian welfare model: the case of Denmark," Economics Working Papers 2011-10, Department of Economics and Business Economics, Aarhus University.
    • Handle: RePEc:aah:aarhec:2011-10
    as

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    File URL: https://repec.econ.au.dk/repec/afn/wp/11/wp11_10.pdf
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    References listed on IDEAS

    as
    1. Richard Rogerson, 2007. "Taxation and market work: is Scandinavia an outlier?," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 32(1), pages 59-85, July.
    2. Torben M. Andersen, 2011. "Collective risk sharing: The social safety net and employment," Economics Working Papers 2011-02, Department of Economics and Business Economics, Aarhus University.
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    11. Torben M. Andersen & Michael Svarer, 2007. "Flexicurity: Labour Market Performance in Denmark," CESifo Economic Studies, CESifo Group, vol. 53(3), pages 389-429, September.
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    Full references (including those not matched with items on IDEAS)

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Why Scandinavian social policies work
      by Economic Logician in Economic Logic on 2012-03-16 20:02:00

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    More about this item

    Keywords

    workfare; employment; distribution; welfare state;
    All these keywords.

    JEL classification:

    • H10 - Public Economics - - Structure and Scope of Government - - - General
    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General

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    1. Economic Logic blog

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