Patterns of Welfare State Indicators in the EU: Is There Convergence?

Abstract

Convergence of social protection objectives and policies in member states is an explicit objective of the EU. Earlier research has shown that there has indeed been a tendency of convergence of social protection levels over the last decades. However, comparative studies frequently use indicators which may not be representative as measures of the welfare state. In this paper we have done several convergence tests with the most recent data, using a variety of indicators of social protection: social expenditures, both at the macro and at the program level, replacement rates of unemployment and social assistance benefits and poverty indicators. Together, these indicators provide a more broad picture of the evolution of social protection. Our results are less clear cut than earlier findings. We still find convergence of social expenditure in EU-countries over a longer period. However, this trend seems to have stagnated in recent years. The evidence is mixed for the other indicators. Replacement rates of unemployment benefits converged to a higher level, but social assistance benefits did not. Poverty rates and poverty gaps did converge since the mid-1980s, but the levels of both indicators have developed in the opposite direction.

Keywords: welfare states, convergence, Europeanization, social indicators

JEL Classification: H53, H55