A ranking of European Regions by GDP per capita

Data comes from Eurostat.

Rank Country NUTS Code Name Purchasing power standards (PPS) per inhabitant in percentage of the EU average
1 UK UKI3 Inner London – West 539
2 LU LU00 Luxembourg 266
3 BE BE10 Région de Bruxelles-Capitale / Brussels Hoofdstedelijk Gewest 207
4 DE DE60 Hamburg 206
5 UK UKI4 Inner London – East 204
6 SK SK01 Bratislavský kraj 186
7 DE DE21 Oberbayern 179
8 FR FR10 Île de France 178
9 CZ CZ01 Praha 173
10 SE SE11 Stockholm 172
11 UK UKM5 North Eastern Scotland 164
12 DE DE71 Darmstadt 163
13 NL NL11 Groningen 163
14 DE DE11 Stuttgart 162
15 DE DE50 Bremen 161
16 NL NL32 Noord-Holland 161
17 AT AT13 Wien 158
18 DK DK01 Hovedstaden 157
19 NL NL31 Utrecht 154
20 AT AT32 Salzburg 152
21 IE IE02 Southern and Eastern 150
22 UK UKJ1 Berkshire, Buckinghamshire and Oxfordshire 149
23 FI FI1B Helsinki-Uusimaa 144
24 IT ITH1 Provincia Autonoma di Bolzano/Bozen 144
25 DE DE12 Karlsruhe 140
26 AT AT34 Vorarlberg 139
27 AT AT33 Tirol 138
28 BE BE21 Prov. Antwerpen 138
29 FI FI20 Åland 138
30 DE DE14 Tübingen 136
31 DE DE91 Braunschweig 136
32 DE DE25 Mittelfranken 135
33 DE DEA1 Düsseldorf 134
34 NL NL41 Noord-Brabant 134
35 IT ITC2 Valle d’Aosta/Vallée d’Aoste 133
36 AT AT31 Oberösterreich 132
37 DE DEA2 Köln 132
38 NL NL33 Zuid-Holland 131
39 BE BE31 Prov. Brabant Wallon 130
40 AT AT – ustria 129
41 BE BE24 Prov. Vlaams-Brabant 129
42 RO RO32 Bucuresti – Ilfov 129
43 DE DE23 Oberpfalz 128
44 DE DE26 Unterfranken 127
45 IT ITC4 Lombardia 126
46 DE DE27 Schwaben 125
47 ES ES30 Comunidad de Madrid 125
48 IT ITH2 Provincia Autonoma di Trento 123
49 UK UKD6 Cheshire 123
50 DE DE13 Freiburg 122
51 DE DEA4 Detmold 122
52 DE DE22 Niederbayern 121
53 DE DE92 Hannover 121
54 UK UKI7 Outer London – West and North West 121
55 DE DE30 Berlin 119
56 DE DEB3 Rheinhessen-Pfalz 119
57 DE DEC0 Saarland 119
58 ES ES21 País Vasco 119
59 DE DE73 Kassel 118
60 SE SE23 Västsverige 118
61 IT ITH5 Emilia-Romagna 117
62 AT AT22 Steiermark 116
63 BE BE25 Prov. West-Vlaanderen 115
64 UK UKJ2 Surrey, East and West Sussex 115
65 DE DE24 Oberfranken 114
66 IT ITI4 Lazio 114
67 SE SE33 Övre Norrland 114
68 DE DEA5 Arnsberg 113
69 ES ES22 Comunidad Foral de Navarra 113
70 UK UKH2 Bedfordshire and Hertfordshire 113
71 DK DK03 Syddanmark 112
72 DK DK04 Midtjylland 112
73 UK UKJ3 Hampshire and Isle of Wight 112
74 UK UKK1 Gloucestershire, Wiltshire and Bristol/Bath area 112
75 DE DE94 Weser-Ems 111
76 NL NL22 Gelderland 110
77 DE DE72 Gießen 109
78 DE DEA3 Münster 109
79 NL NL42 Limburg (NL) 109
80 AT AT21 Kärnten 108
81 BE BE23 Prov. Oost-Vlaanderen 108
82 ES ES51 Cataluña 108
83 IT ITH3 Veneto 108
84 PL PL12 Mazowieckie 108
85 DE DEB1 Koblenz 107
86 DK DK05 Nordjylland 107
87 HU HU10 Közép-Magyarország 107
88 NL NL21 Overijssel 107
89 SE SE32 Mellersta Norrland 107
90 FR FR71 Rhône-Alpes 106
91 PT PT17 Área Metropolitana de Lisboa 106
92 SE SE12 Östra Mellansverige 106
93 AT AT12 Niederösterreich 105
94 SE SE22 Sydsverige 105
95 DE DEF0 Schleswig-Holstein 104
96 IT ITC3 Liguria 104
97 IT ITI1 Toscana 104
98 SE SE21 Småland med öarna 104
99 DE DED5 Leipzig 103
100 FR FR82 Provence-Alpes-Côte d’Azur 102
101 IT ITH4 Friuli-Venezia Giulia 101
102 UK UKH1 East Anglia 101
103 ES ES23 La Rioja 100
104 ES ES24 Aragón 100
105 IT ITC1 Piemonte 100
106 NL NL23 Flevoland 100
107 NL NL34 Zeeland 100
108 DE DEB2 Trier 99
109 EL EL30 Attiki 99
110 FI FI19 Länsi-Suomi 99
111 SE SE31 Norra Mellansverige 99
112 UK UKM2 Eastern Scotland 99
113 BE BE22 Prov. Limburg (BE) 98
114 SI SI04 Zahodna Slovenija 98
115 UK UKE2 North Yorkshire 98
116 UK UKI6 Outer London – South 98
117 FI FI1C Etelä-Suomi 97
118 FR FR42 Alsace 97
119 UK UKG1 Herefordshire, Worcestershire and Warwickshire 97
120 ES ES53 Illes Balears 96
121 FR FR62 Midi-Pyrénées 96
122 UK UKF2 Leicestershire, Rutland and Northamptonshire 96
123 DE DED2 Dresden 95
124 FR FR51 Pays de la Loire 95
125 FR FR21 Champagne-Ardenne 94
126 NL NL13 Drenthe 94
127 UK UKD1 Cumbria 94
128 FR FR23 Haute-Normandie 93
129 NL NL12 Friesland (NL) 93
130 UK UKM6 Highlands and Islands 93
131 FR FR61 Aquitaine 92
132 IT ITI3 Marche 92
133 UK UKD3 Greater Manchester 92
134 FI FI1D Pohjois- ja Itä-Suomi 91
135 UK UKE4 West Yorkshire 91
136 UK UKM3 South Western Scotland 91
137 FR FR26 Bourgogne 90
138 UK UKK2 Dorset and Somerset 90
139 UK UKL2 East Wales 90
140 AT AT11 Burgenland (AT) 89
141 FR FR83 Corse 89
142 DE DE40 Brandenburg 88
143 DE DE93 Lüneburg 88
144 DE DEG0 Thüringen 88
145 FR FR24 Centre (FR) 88
146 FR FR52 Bretagne 88
147 IE IE01 Border, Midland and Western 88
148 UK UKH3 Essex 88
149 UK UKJ4 Kent 88
150 BE BE33 Prov. Liège 87
151 DE DED4 Chemnitz 87
152 DE DEE0 Sachsen-Anhalt 87
153 FR FR53 Poitou-Charentes 87
154 IT ITI2 Umbria 87
155 UK UKF1 Derbyshire and Nottinghamshire 87
156 ES ES41 Castilla y León 86
157 MT MT00 Malta 86
158 UK UKG3 West Midlands 86
159 DK DK02 Sjælland 85
160 FR FR25 Basse-Normandie 85
161 FR FR30 Nord – Pas-de-Calais 85
162 FR FR72 Auvergne 85
163 UK UKK4 Devon 85
164 DE DE80 Mecklenburg-Vorpommern 84
165 IT ITF1 Abruzzo 84
166 UK UKC2 Northumberland and Tyne and Wear 84
167 BE BE35 Prov. Namur 83
168 UK UKE1 East Yorkshire and Northern Lincolnshire 83
169 CY CY00 Kypros 82
170 ES ES13 Cantabria 82
171 UK UKD4 Lancashire 82
172 UK UKG2 Shropshire and Staffordshire 82
173 UK UKN0 Northern Ireland (UK) 82
174 FR FR81 Languedoc-Roussillon 81
175 UK UKD7 Merseyside 81
176 UK UKF3 Lincolnshire 81
177 UK UKI5 Outer London – East and North East 81
178 EL EL42 Notio Aigaio 80
179 ES ES11 Galicia 80
180 ES ES12 Principado de Asturias 80
181 ES ES52 Comunidad Valenciana 80
182 FR FR63 Limousin 80
183 CZ CZ06 Jihovýchod 79
184 FR FR41 Lorraine 79
185 ES ES70 Canarias (ES) 78
186 FR FR22 Picardie 78
187 PT PT15 Algarve 78
188 CZ CZ02 Strední Cechy 77
189 FR FR43 Franche-Comté 77
190 FR FRA2 Martinique 77
191 BE BE32 Prov. Hainaut 76
192 BE BE34 Prov. Luxembourg (BE) 76
193 CZ CZ03 Jihozápad 76
194 EE EE00 Eesti 76
195 ES ES63 Ciudad Autónoma de Ceuta (ES) 76
196 PL PL51 Dolnoslaskie 76
197 UK UKE3 South Yorkshire 76
198 BG BG41 Yugozapaden 75
199 IT ITF2 Molise 75
200 LT LT00 Lietuva 75
201 UK UKK3 Cornwall and Isles of Scilly 75
202 ES ES62 Región de Murcia 74
203 UK UKC1 Tees Valley and Durham 74
204 FR FRA1 Guadeloupe 73
205 PL PL41 Wielkopolskie 73
206 PT PT30 Região Autónoma da Madeira (PT) 73
207 ES ES42 Castilla-la Mancha 72
208 IT ITG2 Sardegna 72
209 SK SK02 Západné Slovensko 72
210 HU HU22 Nyugat-Dunántúl 71
211 PT PT20 Região Autónoma dos Açores (PT) 71
212 CZ CZ05 Severovýchod 70
213 CZ CZ07 Strední Morava 70
214 CZ CZ08 Moravskoslezsko 70
215 FR FRA4 La Réunion 70
216 PL PL22 Slaskie 70
217 PT PT18 Alentejo 70
218 IT ITF5 Basilicata 69
219 UK UKL1 West Wales and The Valleys 69
220 ES ES64 Ciudad Autónoma de Melilla (ES) 68
221 SI SI03 Vzhodna Slovenija 68
222 EL EL62 Ionia Nisia 67
223 ES ES61 Andalucía 67
224 PT PT16 Centro (PT) 67
225 EL EL53 Dytiki Makedonia 66
226 PT PT11 Norte 65
227 LV LV00 Latvija 64
228 PL PL63 Pomorskie 64
229 CZ CZ04 Severozápad 63
230 EL EL43 Kriti 63
231 ES ES43 Extremadura 63
232 IT ITF4 Puglia 63
233 PL PL11 Lódzkie 63
234 IT ITG1 Sicilia 62
235 EL EL64 Sterea Ellada 61
236 HU HU21 Közép-Dunántúl 61
237 IT ITF3 Campania 61
238 SK SK03 Stredné Slovensko 61
239 HR HR04 Kontinentalna Hrvatska 60
240 PL PL21 Malopolskie 60
241 IT ITF6 Calabria 59
242 EL EL65 Peloponnisos 58
243 FR FRA3 Guyane 58
244 RO RO42 Vest 58
245 EL EL41 Voreio Aigaio 57
246 HR HR03 Jadranska Hrvatska 57
247 PL PL42 Zachodniopomorskie 57
248 PL PL43 Lubuskie 57
249 EL EL52 Kentriki Makedonia 56
250 EL EL61 Thessalia 55
251 PL PL52 Opolskie 55
252 PL PL61 Kujawsko-Pomorskie 55
253 EL EL63 Dytiki Ellada 54
254 SK SK04 Východné Slovensko 53
255 RO RO12 Centru 52
256 EL EL54 Ipeiros 51
257 EL EL51 Anatoliki Makedonia, Thraki 50
258 RO RO22 Sud-Est 50
259 PL PL33 Swietokrzyskie 49
260 PL PL34 Podlaskie 49
261 PL PL32 Podkarpackie 48
262 PL PL62 Warminsko-Mazurskie 48
263 RO RO11 Nord-Vest 48
264 HU HU33 Dél-Alföld 47
265 PL PL31 Lubelskie 47
266 HU HU23 Dél-Dunántúl 45
267 HU HU32 Észak-Alföld 43
268 RO RO31 Sud – Muntenia 43
269 HU HU31 Észak-Magyarország 42
270 RO RO41 Sud-Vest Oltenia 41
271 BG BG33 Severoiztochen 39
272 BG BG34 Yugoiztochen 39
273 MK MK00 Poranesna jugoslovenska Republika Makedonija 37
274 BG BG32 Severen tsentralen 34
275 RO RO21 Nord-Est 34
276 BG BG42 Yuzhen tsentralen 32
277 FR FRA5 Mayotte 31
278 BG BG31 Severozapaden 30

On the Survival of the Dutch Polder Model: Performance, Populism, Political Economy

To be published (in Dutch) in Beleid en Maatschapij, symposium on “Nog steeds een mirakel? De legitimiteit van het poldermodel in de eenentwintigste eeuw“, ed by Maarten Keune, Amsterdam University Pressnog-steeds-een-mirakel-de-legitimiteit-van-het-poldermodel-in-de-eenentwintigste-eeuw

 

The totemic status of the Dutch polder model  may have waned somewhat since the publication of Visser and Hemerijck’s “Dutch Miracle” in 1997, but in comparative terms Dutch neo-corporatism – the system whereby trade unions and employers get to decisively shape social and economic policies – still displays a remarkable degree of stability compared with other European countries. Ireland, for instance, another country considered a neo-corporatist miracle in the 1990s and 2000s, has witnessed the virtual collapse of its social partnership model in the aftermath of the financial crisis  (Culpepper and Regan, 2014). While neocorporatism seemed to have undergone a revival in Southern Europe in the 1990s (Hancke & Rhodes 2005), the crisis and the need to cut back spending have led to the marginalisation of employers and trade unions there as well, with the possible exception of Portugal. Austrian corporatism, probably one of the most developed in the world, has seen its legitimacy undermined by populist challengers (the FPö, the Austrian counterpart of the PVV), and scandals involving banks controlled by the trade unions (Afonso, 2013). While Switzerland has also performed well in the aftermath of the crisis, the role of social partners there has also been challenged by party polarisation and the strengthening of populist parties (Haeusermann et al 2004; Afonso & Papadopoulos 2015).

In contrast, while the Dutch economy has also faced serious consequences as a result of the financial crisis, notably a high level of household debt, and its political system  has faced a similar populist upsurge coming from Geert Wilders’s Freedom party, the Dutch Polder model seems to display a good level of resilience in the face of these challenges. Hence, the volume edited by Maarten Keune draws a nuanced picture of the Poldermodel, looking at its economic performance and political legitimacy. Drawing on the contributions of the book, I will address a series of challenges the Dutch border and more all is faced, mainly from our comparative perspective, and seek to answer why it seems to have survived, and the whether it could be exported. I will first draw in assessments of the current state of the Polder model based on the contributions of the book, then address the following challenges: political change and the challenge of populist parties, changes in the economic structure at the level of finance and labour markets, and finally address the potential for the diffusion of the Polder model to other countries in the context of the Eurozone crisis.

Performance

As made clear in the chapter by Caelesta Braun, as well as Maarten Keune’s introductory chapter, the legitimacy and resilience of neocorporatism rested on its ability to deliver better economic performance – output legitimacy – which would outweigh its inconvenient in terms of input legitimacy, or its ability to aggregate the preferences of a majority of voters. In the words of Norwegian political scientist Stein Rokkan (1966), in neocorporatism, “votes count, but resources decide”. The Dutch Polder model matched to this idea: social pacts negotiated between trade unions, employers and the government have shaped a number of important reforms in social protection, labour market regulation and wage setting while parliament often merely rubber-stamped agreements. From the point of view of input legitimacy, this is problematic given that only one in six Dutch workers is a member of a trade union.

But is this democratic deficit justified by superior economic performance? As shown by Visser in his contribution, the Dutch economy has been performing well over the last decades in terms of both employment and equality. While employment levels have been among the highest in Europe, especially among women and young people, the Dutch labour market has been astonishingly spared by the rise in inequalities that has spanned all advanced economies since the 1980s. This pattern can be accounted for by the persisting high coverage of collective labour agreements in spite of the dwindling membership of trade unions (outlined in the contribution by Paul de Beer), and the expansion of employment underpinned by the creation of a large number of – mostly part-time – jobs. Hence, the Dutch model is a good example of the “high employment road to low inequality” presented by Kenworthy (2009; Afonso & Visser 2015). Arguably, as Keune makes clear, the Dutch economy has been an outstanding jobs-creation machine, but not a work-creation machine if one considers the huge proportion of part-time jobs in the economy and the total number of working hours performed. Yet, work-sharing via the wide distribution of part-time work – as compared to the concentrated participation on (male) full-time workers that prevails in Southern Europe, for example – is arguably a good solution to achieve low inequality in a political context which doesn’t allow for mass public sector expansion, as in Scandinavian countries. Hence, one possible reason for the survival and resilience of the Polder model is that it has made it possible to deliver both economic performance and provided an effective shield against inequality.

The main output-related argument in favour of the Polder model has been that a particular type of political process involving cooperation between unions and employers has been the cause of the good economic performance of the Dutch economy. The main transmission channel connecting them has been wage restraint: by containing wage increases, the Polder Model has allegedly made it possible to preserve the competitive position of the largely export-oriented Dutch economy, and deliver better employment outcomes. However, this causal relationship can be questioned in a number of respects. One of the most severe criticisms is the one expressed by Ewald Engelen. Rather than an export-driven success, Dutch economic performance has been the result of a hybrid system where the domestic consequences of wage restraint have been compensated by a form of “private keynesianism” propelled mostly by mortgage debt. Hence, high employment happened could have happened despite, rather than because of the Polder Model of wage compression. While wage restraint has dampened domestic demand, mortgage debt has been used to boost it, notably policies such as the Hypotheekrenteaftrek. Hence, the high level of household debt in the Netherlands – Dutch households were the most indebted in the euro area in 2015, with debt representing 283% of household income – may actually be a flipside of the Polder model. This high level of indebtedness is often presented as a major reason for the slow recovery of the Dutch economy after the crisis in comparison with, say, Belgium (FT Alphaville 2016). After the fall of house prices, Dutch households have sought to balance their books and hoarded consumption.

 

Populism and Electoral Fragmentation

The first challenge faced by the Dutch Polder Model is the increasing fragmentation of the Dutch party system, the weakening of the traditional advocates of corporatist compromises in the legislative arena, and the rise of a populist party claiming to represent the traditional base of trade unions. As emphasised by Keune in his contribution, strong corporatism needs a strong government. This has been especially important when it comes to the regulation of the labour markets via CAOs (explained in the contribution by Verhoeff). In the face of declining trade union membership, political intervention has been a pillar of corporatist compromises by systematically extending collective bargaining outcomes and making them compulsory. Traditionally, the parties that have defended corporatist compromises in the Dutch context have been the PvdA and to some extent the CDA. Now, these parties have faced a dramatic electoral decline over the last decades. In 1993, the CDA and the PvdA represented 66% of parliamentary seats in the Tweede Kamer. After the 2012 elections, this share had fallen to 33%, and projections for the 2017 elections at the time of writing gave 8% and 10% for the PvDA and the CDA respectively. Hence, the channels of transmission of the Polder model into politics have become fairly thin.

The new parties that have emerged or been strengthened in recent years have adopted a generally more critical stance towards neo-corporatist institutions, and had less problems with sidelining trade unions and employers. The “Lenteakkoord” concluded in 2012 between the VVD, CDA, D66, ChristenUnie and GroenLinks was an example of this. One reason is that the extreme proportionality of the Dutch electoral system has facilitated the autonomisation of new middle class constituencies and their move away from the fore of social democracy to new parties (D66, Groenlinks; 50+ and others) with somewhat different socio-economic positions, and the weakening of their organic ties with trade unions. In other countries where the electoral system makes it more difficult for new parties to emerge, these constituencies are kept together, usually under the umbrella of a social-democratic party.

The counterpart of the shrinking of the pro-Polder parties in parliament has been the rise of the PVV as a powerful opposition force with a resolute anti-Polder position. In his Onafhangelijkeidverklaring from 2005, Wilders wrote that the Poldermodel “moet op de helling, zonder pardon, en dat betekent dus het einde van de praat- en overlegpaleizen als de SER en de Stichting van de Arbeid”, as well as “Het afschaffen van het algemeen verbindend verklaren van CAO’s” (PVV 2005). As other populist parties in Europe, the PVV has been very critical of neo-corporatist institutions perceived to work like a political cartel from which it is mostly excluded. Dismantling it is a way to undermine the cosy relationship between mainstream parties and interest groups, and especially trade unions. Interestingly, trade unions typically represented the socio-economic clienteles that the PVV is now mostly claiming, namely older, low-and-middle skilled working class workers. Weakening their influence can also be part of a strategy to become the only voice of this constituency. In 2011, for instance, the PVV proposed to give voting rights to non-union members in the negotiations of collective labour agreements as a way to dilute the influence of labour organisations (BNR 2011)

This being said, the increasing fragmentation of the party system may not necessarily mean the end of the Polder model. Indeed, as examples in other countries show, the polarisation of politics may actually constitute an opportunity for social partners because of their continuing ability to reach compromises when political parties can’t (Afonso 2013). Hence, in the perspective of a multi-party government in which agreements may be difficult to reach, readymade solutions by social partners may still be able to make their way into policy.

 

Political-Economic Change

The last important challenge for the Poldermodel is the change in the economic structure. This mainly relates to the evolution of the labour market and its attainment of a potential ceiling and the increasing financialisation of the Dutch economy, especially when it comes to the pension system (explained in the contribution by Van der Zwan).

The first challenge has to do with the ability of the Polder model to deliver superior economic performance, especially when it comes to women. In many respects the “jobs miracle” that took place in the Netherlands in the 1980s and 1990s was based on the creation of part-time jobs mainly taken up by women. This expansion was fairly spectacular, but it was mainly a catching-up phenomenon in comparative terms because female employment in the Netherlands started at very low levels. In fact, The Netherlands had the lowest level of female labour force participation in Europe 1971, nearly 20% below the OECD average. The publication of the Dutch Miracle in 1997 corresponded to this level just about reaching the OECD average. Since then, the potential for increasing female labour force participation has shrunk, and the rate of increase between 1996-2015 and 1985-1995 has halved. Now it is unclear which potential source of labour can be used to increase the labour force. If the output legitimacy of the Polder Model was based on mass job creation, it may now be running out of steam.

The second aspect relates to the increasing financialisation of the Dutch economy, the in-built volatility this introduces, and how it changes the preferences of the actors involved. First, the compromises that underpinned the Polder Model were premised on the ability of domestic actors to exert some control over economic parameters via economic policy choices. Second, it was based on a class compromise between actors with clear interests, namely employers wanting wage restraint and trade unions wanting jobs, better purchasing power and/or social protection. As outlined in van der Zwan and Engelen’s contributions, these assumptions have been severely challenge by the tremendous increase in the level of financialisation of the Dutch economy. In 1995, stocks traded represented 25% of Dutch GDP. By 2000, they represented 150%, and 183% in 2007, with very high levels of volatility, notably after the Dot.com bubble and the global financial crisis. This factor has challenged some basic tenets of the Polder model in two major ways. First, the heavy level of involvement of pension funds jointly managed by social partners in financial markets has blurred the interests of capital and labour. The future income of workers via pension benefits is tied to investment decisions which may go against the interests of other workers, for instance by favouring short-term profits over long-term investments. In a nutshell, workers have become capitalists by procuration. Secondly, and most importantly the high level of volatility and uncertainty brought in by financialisation has made corporatist compromises extremely vulnerable to events happening in financial markets, which are globalised. Hence, it has become more difficult for corporatist actors to make credible commitments – eg. about pension benefits – since revenues are largely beyond their direct control, and may undergo high levels of volatility.

In sum, while the Polder model has indeed displayed a fairly high degree of resilience, it hasn’t been immune to broader political and economic developments which could possibly fundamentally transform it in the long term. While it is unlikely to disappear, it may however be deprived of much of its regulatory capacity in a context of financialisation, and the economic “Miracle” which attracted wide international attention is going to be difficult to sustain, let alone renew. Keune’s edited volume convincingly recognises its successes, but also convincingly highlights its many hidden vectors of instability.

Bibliography

Afonso, Alexandre, and Yannis Papadopoulos. 2015. “How the Populist Radical Right Transformed Swiss Welfare Politics: From Compromises to Polarization.” Swiss Political Science Review 21(4): 617–35.

Afonso, Alexandre. 2013. Social Concertation in Times of Austerity. Amsterdam: Amsterdam University Press.

BNR. 2011. Jacht op vakbonden is geopend.

Culpepper, P. D., and A. Regan. 2014. “Why Don’t Governments Need Trade Unions Anymore? The Death of Social Pacts in Ireland and Italy.” Socio-Economic Review 12(4): 723–45.

Afonso, A and Visser, J. 2014. “The Liberal Corporatist Road to High Employment and Low Inequality? The Dutch and Swiss Social Models in the Crisis, in Dølvik, Jon Erik, and Andrew Martin. 2015. European Social Models from Crisis to Crisis: Employment and Inequality in the Era of Monetary Integration. Oxford: Oxford University Press.

Financial Times. 2016. Why is the Netherlands doing so badly? https://ftalphaville.ft.com/2016/06/16/2166258/why-is-the-netherlands-doing-so-badly/ (January 4, 2017).

Hancke, B. and Rhodes, M. 2005. “EMU and Labor Market Institutions in Europe: The Rise and Fall of National Social Pacts.” Work and Occupations 32(2): 196–228.

Häusermann, Silja, André Mach, and Yannis Papadopoulos. 2004. “From Corporatism to Partisan Politics: Social Policy Making under Strain in Switzerland.” Swiss Political Science Review 10(2): 33–59.

Kenworthy, Lane. 2009. “The High-Employment Route to Low Inequality.” Challenge 52(5): 77–99.

Rokkan, S. 1966. “Norway: Numerical Democracy and Corporate Pluralism.” In Political Oppositions in Western Democracies, ed. R. A. Dahl. Yale: Yale University Press.

Partij voor de Vrijheid. 2005 “Onafhangelijkheidsvreklaringhttp://www.pvv.nl/index.php/component/content/article/30-publicaties/684-onafhankelijkheidsverklaring (January 4, 2017).

Book review: How a strong Communist party led to less social protection in Portugal, and its absence to more protection in Spain

9780190245474The Left Divided: The Development and Transformation of Advanced Welfare States By Sara E. Watson, Oxford: Oxford University Press, 2015. ISBN: 9780190245474, 376 p (review to appear in Political Studies Review, autumn 2017).

One of the most widespread assumptions in welfare state and comparative political economy research is that the strength of the left is the major driver of redistributive policies in advanced industrialized countries. However, most of the classic works in the field have assumed that the left constitutes an homogeneous bloc. Scandinavian countries, where social-democratic parties have been closely connected to powerful trade unions, have constituted the main empirical basis of important works advocating this position, such as those of Esping-Andersen (1992) or Korpi (1983).

In her impressive comparative analysis of Spain and Portugal, Sara Watson shows that this assumption of homogeneity within the left is more the exception than the norm. In many countries, the left is divided across the party and industrial relations system between a moderate and a radical left, and these divisions and competition patterns among left-wing parties can yield counterintuitive effects on inequality and redistribution. Hence, she shows how Portugal, where a powerful Communist party was able to control the trade union movement during the transition to democracy, developed a more unequal and liberal welfare model in the 1970s and 1980s. Spain, meanwhile, where the transition was controlled by the right, established a system with a higher level of social protection for workers in the aftermath of transition. This unexpected outcome, Watson argues, was the result of partisan strategies. Faced with a strong far-left competitor, the Portuguese moderate Socialist Party adopted a deliberate strategy to weaken the Communists and their trade union allies organizationally, resulting in a higher level of exposure of Portuguese workers to market forces. In the absence of comparable patterns of intra-left competition, no such incentives for liberalization existed in Spain. Accordingly, this political process shaped labour market outcomes in both countries up to now, with higher social protection but higher unemployment in Spain, and low unemployment but more poverty and inequality in Portugal.

To support this clever theoretical argument, Watson draws on an impressive comparative historical analysis connecting the intricacies of intra-left competition with changes in industrial relations, employment protection and income compensation. Combining theoretical innovation with an impressive comparative-historical analysis, this is by far the best account of the development of welfare capitalism in Spain and Portugal after democratisation, and its insights will be relevant for scholars working on a much broader range of countries.

References

Esping-andersen, G. 1992. Politics Against Markets. Princeton: Princeton University Press.

Korpi, W. 1983. The Democratic Class Struggle. London: Routledge.

 

Democracy in Cuba, 1900-2010

cuba

The V-Dem dataset is a huge dataset that compiles many indicators to measure political institutions, dating back to 1900. With the death of Fidel Castro, I tried to see what the indicators said about the evolution of democracy in Cuba. It shows a tremendous decline after 1950. Interestingly this started before Fidel Castro, during the dictatorship of Fulgencio Batista. When Castro took power, the democratic index stayed low, essentially continuing the type of autocratic rule pursued by Batista with a different ideological bent.

Donald Trump’s victory in historical perspective

graph

Donald Trump is on course to be the US presidential candidate to win the Presidency with the largest negative popular vote margin, with nearly 2 million votes less than Hillary Clinton. At the same time, Hillary Clinton is set to become the presidential candidate with the third largest number of votes in US history.

capture-decran-2016-11-25-a-12-14-07

The Fiscal Impact of Immigrants: Perceptions vs. Reality

 

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The graph above charts popular perceptions about how much immigrants pay into the welfare state (vertical axis) against what they actually pay (horizontal axis, in euros per household). The data comes from a paper by Huber et al. for the horizontal axis (based on EU SILC data) and the the vertical axis comes from the Eurobarometer 2009, which asked people if they thought that immigrants in their country pay more in taxes than they receive in welfare. A few interesting facts:

First, in all countries but Spain and Portugal, a majority of people think that immigrants receive more than what they pay. However, in reality this is far from being the case in all countries: a number of them receive more from immigrants than what they give them. This is for instance the case in the Netherlands, the UK, Sweden and Italy. In this latter country, 3 billion euros a year in pension benefits remain unclaimed by migrants who returned home.

Second, in spite of people in many countries having a wrong idea about the fiscal contribution of immigrants, there is nevertheless a positive relationship between these two measures: the more immigrants contribute, the more people are likely to think that this is the case.

Third, these are absolute measures; they do not measure the difference between native and migrant households. In some countries, both natives and immigrants have a negative fiscal balance (that is, both receive more than what they pay). However, in others the balance is strikingly different. In the United Kingdom, the fiscal balance is negative for natives and positive for migrants, which means that natives are partly “bailed out” by migrants. In Germany, it is the opposite.

Comparing EU member states and US states

Economists often compare the European Union and the United States, notably in the context of macro-economic management. For instance, the United States has a fiscal union that allows automatic transfers from richer states to poorer states, a system that the European Union does not have. The United States also has a more integrated labour market, and people move more easily between states, for instance from high-unemployment to low unemployment states. In the graphs below, I have pooled together data on GDP per capita and GDP growth rate in the European Union and the United States. The differences are quite striking: US states are much more similar both in terms of GDP per capita and growth rates than European Union member states. This means that growth is more correlated across US states than across EU member states. Both have their outliers: Washington DC in the US and Luxembourg in the European Union. Greece stands out as a (negative) outlier in terms of GDP growth in the EU, while Texas and North Dakota have had much higher growth rates than the rest of the country.

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