Welfare in post-industrial era. New social risks in Spain and Italy

Abstract

European welfare states were built in the second postwar period to protect mostly (male) breadwinners and, indirectly, their families, against unemployment, illness and disability. But since then, the structure of social risks has become more complex. In post-industrial societies the well-being of families and households depends to a large extent on the efforts made by welfare states to address also new social risks (NSRs) including, among others, those derived from precarious employment, long-term unemployment, in-work poverty, single parenthood, and inability to reconcile work and family life (Bonoli, 2005; Taylor-Gooby, 2004). According to some of the most cited literature analyzing the drivers of NSRs policies (Taylor-Gooby, 2004; Bonoli, 2005; Bonoli, 2007; Tepe & Vanhuysse, 2010), the prospects of South European welfare states to catch up with those of Central and, especially, North Europe, were gloomy. The reason advanced for the generation of permanent differences among welfare regimes consisted of the relevance of the timing hypothesis, i.e. the later the transition into a post-industrial society, the lesser the budgetary scope available for the coverage of NSRs, and this mainly due to the effect of population aging on higher expenditure on old social risks (OSRs) (Bonoli, 2007). The present analysis seeks to dialogue with Bonoli (2007, this journal) through the evaluation of the recent evolution of South European welfare states or, in other words, whether the timing hypothesis has held. This article aims to assess to what extent the Spanish and Italian welfare states have addressed NSRs policies in terms of social expenditure composition and effort during the last two decades and to interpret the differences observed between them. In particular, it endeavors to answer three further questions. First, the contribution assesses if the two countries, usually associated within the same cluster of welfare states (the “Southern European” one) diverge from one another in relation to the degree of post-industrialization and whether expenditure effort on NSRs matches such social evolution. Second, in the debate about NSRs several scholars have pointed out that it should not be assumed that old risks have become less important than in the past (Crouch & Keune, 2012; Huber and Stephens, 2007). Hence, in this article we also consider whether the development of NSRs policies has been done to the detriment of the traditional OSRs policies. In short, the ‘resource competition hypothesis’ (Cantillon, 2011; Vandenbroucke & Vleminckx, 2011) is checked for the Spanish and Italian cases. According to this hypothesis, given the limitation of public resources, there is a trade-off in welfare state budgets: the stress on NSRs policies implying reduced availability for OSRs policies. This would apply to the pre-crisis period. The contrary is also possible and it would be more probable during the crisis, i.e. the protection of OSRs (such as unemployment or pensions) absorbs more public funding than previously, detracting financial resources to cover new social risks (Breuning & Busemeyer, 2012; Mertens, 2017). This last scenario is known as ‘reversed resource competition’: it is the budgetary effort put into OSRs that increases to the detriment of NSRs (Ronchi, 2018). Third, we seek to interpret the divergences observed in the trajectories followed by both countries under the light of: a) socio-cultural factors (values, preferences, etc.) influencing demand for NRSs coverage (Pfau-Effinger, 2005) and power resources enjoyed by organized feminism; b) neo-institutional theory (policy legacies and windows of opportunity for path departure) (Skocpol & Amenta, 1986; Pierson & Skocpol, 2002; Pierson, 2004); and c) partisan politics (Hibbs, 1992; Schmidt,1996). The article is structured as follows. Following this introduction, the second section is dedicated to establishing the main traits of Spain and Italy as post-industrial societies and the differences observed. The third section assesses the reconfiguration of social expenditure in order to elicit how much effort has been made in order to integrate OSRs protection with NSRs coverage or to shift from the latter to the former and whether it matches the degree of post-industralization. In the fourth section, we explore the resource and reversed resource competition hypotheses, while, most prominently, an interpretation is forwarded for the different trajectories followed by Spain and Italy with regard to adaptation to NSRs. The text concludes by highlighting the factors that have facilitated/hindered such adaptation.