Bechberger, Elena K
(2007)
Regaining control of the social budgets: Fiscal commitment and social insurance reform in France and Germany 1990-2005.
PhD thesis, London School of Economics and Political Science.
Abstract
Over the past two decades the corporatist-continental welfare states of France and Germany have come under strong budgetary stress. As social expenditure accounts for around half of public spending in both countries, its retrenchment has been prominent on the political agenda. However, governments seeking to contain social spending face the problem that due to the institutional characteristics of the countries' social insurance programmes, a large share of the social budget is pre-committed and largely outside their control. This study analyses how France and Germany have dealt with the strong pressures for retrenchment on the one hand, and high barriers for reform on the other between 1990 and 2005. By identifying systematic links between specific institutional commitment devices, cost-containment strategies and outcomes, it sheds light on the causal mechanisms behind the concept of path-dependency. It demonstrates that contrary to common perceptions, the de-facto degree of fiscal commitment in the French and German welfare states differs quite considerably between insurance sectors and individual schemes. These differences have a systematic effect on the degree to which the governments in both countries have regained influence over the determination of spending in these schemes and therefore over their social budgets. According to the 'old politics' of the welfare state tradition and fiscal institutionalism literature, the nationally distinct actor constellations with regard to corporatist relations and budgetary allocation processes in the two countries should lead to different reform developments. This study challenges these arguments and shows that the motives and influence of the identified actors are strongly mediated by sectoral institutions. This strengthens arguments for a closer combination of both 'new' and 'old' arguments in welfare reform research, as well as for a more differentiated, scheme-specific perspective in analysing path-dependent reform processes and institutional lock-in.
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