Review: Welfare State Challenges and Responses: Institutional and Ideological Resilience

or Restructuring?
Reviewed Work(s): Social Foundations of Postindustrial Economies by Gøsta Esping-
Andersen: The End of the Welfare State? Responses to State Retrenchment by Stefan
Svallfors and Peter Taylor-Gooby: Recasting European Welfare States by Maurizio
Ferrera and Martin Rhodes: Survival of the European Welfare State by Stein Kuhnle:
Welfare and Work in the Open Economy: Volume 1: From Vulnerability to
Competitiveness. Volume 2: Diverse Responses to Common Challenges by Fritz W.
Scharpf and Vivien A. Schmidt: The New Politics of the Welfare State by Paul Pierson
Review by: Diane Sainsbury
Source: Acta Sociologica , 2001, Vol. 44, No. 3 (2001), pp. 257-265
Published by: Sage Publications, Ltd.

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REVIEW ESSAY
Welfare State Challenges and Responses:
Institutional and Ideological Resilience or
Restructuring?
Diane Sainsbury
Department of Political Science, Stockholm University, Sweden
Gosta Esping-Andersen: Social Foundations of
Postindustrial Economies (Oxford and New York:
Oxford University Press, 1999).
Stefan Svallfors and Peter Taylor-Gooby (eds.):
The End of the Welfare State? Responses to State
Retrenchment (London and New York: Rout-
ledge, 1999).
Maurizio Ferrera and Martin Rhodes (eds.):
Recasting European Welfare States (London:
Frank Cass, 2000).
Stein Kuhnle (ed.): Survival of the European
Welfare State (London and New York: Routledge,
2000).
Fritz W Scharpf and Vivien A. Schmidt (eds.):
Welfare and Work in the Open Economy: Volume 1:
From Vulnerability to Competitiveness. Volume 2:
Diverse Responses to Common Challenges (Oxford:
Oxford University Press, 2000).
Paul Pierson (ed.): The New Politics of the Welfare sources, which are compounded by external
State (New York and Oxford: Oxford University
Press, 2001).
Amidst proclamations of its demise, the welfare
state continues to be the focus of scholarly
attention and debate. The scholars contributing
to these seven volumes analyse welfare state
policies and policy change of the 1990s in the
context of long-term trends and current chal-
lenges. Utilizing comparative analyses involving
several countries,' the volumes address a
common set of issues. The first issue is the
nature of the challenges confronting the welfare
state. The second concerns the type of policy
responses during the past decades across wel-
fare states and their effectiveness. What reforms
have been introduced and what are the
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ACTA SOCIOLOGICA 2001
implications of the reforms in terms of change?
To what extent do the reforms reveal a pattern
of convergence or divergence? Do the adopted
measures qualify as downsizing or welfare state
restructuring? How effective have the responses
been? The third issue deals with the political
dynamics shaping responses. A central claim of
The New Politics of the Welfare State is that the
politics of mature welfare states differ funda-
mentally from the politics of expanding welfare
states, and that the theoretical frameworks
devised to explain welfare state expansion are
of limited utility for understanding this new
brand of politics.
1. Challenges to the welfare state
Generally, the authors view the challenges to
the welfare state as stemming from internal
pressures. Accordingly, many do not focus on
globalization and internationalization of the
economy. In the case of the European welfare
states, several contributors acknowledge the
importance of the European Union and eco-
nomic integration, but only one essay is devoted
to the pressures of Europeanization (Falkner in
Kuhnle 2000). However, in Work and Welfare in
the Open Economy, the editors Fritz W Scharpf
and Vivien A. Schmidt emphasize challenges
brought about by increasing exposure to inter-
national economic forces. They investigate
challenges posed by the open economy from
the early 1970s to the late 1990s with respect
to both cross-national developments and indi-
vidual country experiences. As distinct from
previous studies, the authors emphasize varia-
258 ACTA SOCIOLOGICA 2001 VOLUME 44

tion in the challenges due to dissimilar eco- of immigrants and the majority population.
nomic structures and policy legacies. Similarly, several authors are interested in the
By contrast, most of the authors concen- development of new social cleavages, especially
trate on domestically generated pressures, such between insiders and outsiders on the labour
as demographic change, especially population market, but they fail to consider racial and
ageing, the postindustrial transition and its ethnic differences.
effects on economic productivity and the labour
market, changing class and household struc-
tures, popular opinion and value change, 2. Responses: convergence and divergence
interest group arrangements, political processes
and institutional settings. Despite the diversity Globalization, European economic integration
of these challenges, a shared notion underpins and welfare state retrenchment have given new
much of the discussion: societal and economic currency to the convergence thesis. The propo-
changes create new problems or 'risks' but nents of globalization argue that economic
institutional and ideological resilience or inertia exigencies narrow the space where political
leads to locked-in responses, and in the worst decisions count, diminishing the importance of
cases to pathological adjustments. partisan politics and divergent policies. The
Although the authors disassociate them- imperatives of European integration are also
selves from doomsday scenarios, the challenges assumed to operate to reduce divergence. The
they describe seem rooted in the crisis mentality welfare state crisis and ensuing retrenchment
of the early 1990s. Economic imperatives loom led many observers to predict that welfare states
large in the form of rising budget deficits and would converge toward residualism - an
public debts, matched by slowing productivity, increasing reliance on means-tested benefits
declining competitiveness and years of zero and privatization. In hindsight. radical reform
economic growth. The assumption of an envir- strategies of the neo-liberal kind represent an
onment of permanent austerity is also charac- exceptional scenario, mainly confined to New
teristic of this mind set, and it ignores the Zealand and Great Britain (Ferrera & Rhodes
differences in the economic performance of 2000:2 76).
national economies in the 1990s as well as Among the common trends in the reforms
cyclical variations in individual economies of the 1 990s was the introduction of new public
during the decade or in a longer perspective. management principles, especially in the health
In fact, upon closer consideration, permanent services; a move from passive measures to
austerity is probably not the best term for the activation in the areas of unemployment,
current predicament of a growing imbalance sickness and invalidity; increased selectivity in
between welfare state commitments and eligibility for cash benefits; and reforms of social
resources. The term 'permanent austerity' security financing (Ferrera & Rhodes 2000:4-
conjures up associations of constraints created 7). That these common reforms amount to
by economic adversity, but the growing imbal- convergence is debatable, however, for at least
ance even with regard to resources has in some three reasons. First, similar measures may have
instances been caused by political decisions - very different intentions producing divergent
not the economy. outcomes. For example, increased selectivity
A preoccupation with problems of the early aimed at moving people from insurance benefits
1990s also diverts attention from emerging to means-tested programmes is quite different
challenges. Ageing populations are highlighted from the introduction of means-tested benefits
as a major problem, which is exacerbated by to cover persons without insurance benefits.
falling birth rates and their implications for The former most likely reduces coverage, while
dependency ratios.2 However, no one identifiesthe
a latter extends it. Second, similar reforms
coming labour shortage caused by the retiring implemented in different national policy and
generation and low fertility as a source of institutional contexts obviously do not have the
concern; instead, unemployment and insuffi- same outcomes. Recent pension reforms in
cient job growth are stressed. Perhaps most Sweden and Germany introduced measures to
surprising given its mounting importance dur- ensure that private pensions will form a larger
ing the decade is the total neglect of the component of retirement income in the future.
challenge posed by international immigration. In the German system, private benefits comple-
No attention is paid to the possibility of ment a state earnings-related occupational
widening disparities between the social rights pension, while Swedish private pensions con-

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 Welfare State Challenges and Responses 259

stitute an additional tier on top of a guaranteed to the Scandinavian model by strengthening

minimum pension, a state occupational pension
and usually a collective agreement pension.
Third, dissimilar constructions of similar
schemes can result in substantial differences.
Again, taking the Swedish and German pension
reforms as an illustration, the Swedish system
covers the entire working population, whereas
the German scheme is based on tax incentives to
get people to invest in retirement accounts,
which can lead to an incomplete and skewed
coverage. In the Swedish system, the actuarial
risks are pooled for the entire population, while
in the German case risks are pooled separately
for men and women. Finally, amounts invested
in Swedish private pensions are determined by
earnings, but in the German scheme, the
payments and level of state support are also
based on marital status and family responsi-
bilities (Der Spiegel 20/2001).
A further sobering lesson in equating
common trends with convergence is provided
by a comparison of the trends identified in the responses in terms of change. In the opening
early retrenchment literature with subsequent
policies. In the mid-1980s a common observa-
tion was that policymakers in most countries
had tightened unemployment benefits. Ten
years later, however, unemployment benefits
exhibited sharper differences across countries leads to a shedding of welfare responsibilities.
than previously. With the introduction of the
Job Seeker's Allowance in the mid-1990s,
Britain pared insurance benefits to six months alternative is spelt out in much detail, however,
(Sainsbury 1996), whereas the unemployed in
Denmark could received relatively generous
insurance benefits for several years (Goul
Andersen in Kuhnle 2000).
On a more general plane, the volumes
come down on the side of diversity and policy
divergence. The emphasis on divergence
between regimes is reflected in the discussion
of Southern Europe and conclusions about
policy developments in the countries making
up the same regime. In contrast to prior
research, the contours of a fourth distinctive
regime in Southern Europe are more clearly
delineated (Esping-Andersen 1999, chapters 4
and 5; Moreno & Ferrera in Kuhnle 2000). The
researchers examining the Scandinavian coun-
tries conclude that the distinctive characteristics
of the welfare state model - universalism with
several entitlements based on citizenship or
residence, comprehensiveness, redistributive-
ness and employment orientation - basically
remain intact (Eitrheim & Kuhnle in Kuhnle
2000; Kuhnle in Ferrera & Rhodes 2000).
Reforms in Denmark also moved policies closer
universalism and the work principle during the
past decade (Goul Andersen in Kuhnle 2000).
Bringing gender-relevant policies into the ana-
lysis reinforces the conclusion of convergence.
Since 1980 these policies have become similar
at the same time as they increasingly diverge
from those of other welfare state regimes
(Sainsbury 1999; Bergqvist & Nyberg 2002).3
Not only do the authors stress the resilience of
distinctive regime types but that their charac-
teristic features produce different future policy
trajectories (Esping-Andersen 1999; Schrapf &
Schmidt 2000; Pierson 2001).
3. Responses: downsizing, recasting or
what?
While the authors largely agree that diversity
and policy divergence stand out, there is much
less consensus about the nature of welfare state
essay of The End of the Welfare State? Peter
Taylor-Gooby points to two major alternative
responses. The first is 'the hollowing out of the
state' through the loss of its autonomy or
control over the national economy, which
The second response is a new interventionism,
designed to support competitiveness. Neither
because this volume primarily examines how
welfare policies and policy, change have influ-
enced value patterns and attitudes to state
intervention. A key issue is whether changing
values and attitudes of citizens strengthen the
likelihood of one or the other of the two
responses.
The editor of Survival of the European Welfare
State, Stein Kuhnle, notes that the very title of
the volume takes issue with the thesis of the
inevitable crisis of the welfare state, which has
reigned during the past two decades. According
to him, the salient trend is downsizing, and
survival is equated with 'a little less of the same'
(Kuhnle 2000:xvii).4
By contrast, Maurizio Ferrera and Martin
Rhodes emphasize 'recasting' defined as adapta-
tion to external and internal forces. Their
definition is inherently reactive but simulta-
neously highlights change. For Ferrera and
Rhodes, the welfare state must recast many of
its traditional instruments and objectives in
order to survive. More specifically, the problem
is the institutional maladjustment of a set of old

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260 ACTA SOCIOLOGICA 2001 VOLUJME 44

policy solutions, which are gradually losing How helpful this scheme is in resolving
both their effectiveness and flexibility; the solu- disagreements concerning the nature of con-
tion entails combining 'creative new policy temporary welfare state responses is more
mixes with new social bargains, woven together uncertain. Decommodification and its derivative
with a high degree of political imagination' (p. concepts are afflicted with serious ambiguities.6
2 60). This attractively packaged position is In many instances commodification is the basis
problematic, however. First, although they for decommodification. Is decommodification a
acknowledge cross-national differences in chal- prerequisite for recommodification? And in
lenges to the status quo and in capacities for analysing recommodification, how do we dis-
adjustment, their line of reasoning misses the tinguish between workfare, rehabilitation and
crucial point that existing policies vary in their active labour-market measures? At first glance,
effectiveness and flexibility. This key variable the dimension of cost containment seems
must be put into the equation. Second, there straightforward. Nevertheless, it appears to
seems to be an assumption that 'newness' no rule out an important set of welfare state
matter its form is automatically better. In anv readjustments pursued in some countries and
event, the evidence on the efficiency and a course of action recommended for countries of
effectiveness of the 'new' policies, recommended the conservative regime type - broadening or
as solutions, is not yet available. For example, altering the funding of policies. Nor can these
how successful has the introduction of 'the financial responses be easily subsumed in the
"public contract" model of health provision' category of recalibration. This leads one to
been in reducing the costs of medical care wonder if there are important welfare state
(Freeman & Moran in Ferrera & Rhodes policy responses that the three dimensions fail
2000:3 5-58)? to encompass. Pierson notes the problem of
Paul Pierson argues that much of the distinguishing between recalibration and cost
previous analysis has implicitly been informed containment, but this problem also pertains to
by a single continuum of 'more' or 'less' change recommodification and cost containment. In
where one polar end represents the intact (or sum, a major question must be raised: How are
expanding) welfare state and the other end the the dimensions interrelated theoretically and
seriously eroded or dismantled welfare state. In operationally? The breadth of the dimensions
its place he proposes a conceptualization of and the fact that they are not mutually exclusive
welfare state restructuring based on three would seem to pave the way for continued
dimensions. The first dimension is recommodi- controversy about the nature of welfare state
fication or the tightening eligibility rules and responses.
cutting benefits so that a person's livelihood is As evident froin these different stances,
increasingly dependent upon participation in ambiguities characterize the efforts to categor-
the market. The second is cost containment. ize welfare state responses. One problem is that
The third dimension. recalibration, resembles several essays use 'retrenchment', 'recasting',
Ferrera and Rhodes' notion of 'recasting'. Irestructuring' and 'modernization' inter-
Pierson disting,Aishes between two types: (1) changeably and without specification. This
rationalization entailing changes that adopt lessens the prospects of drawing similar conclu-
new ideas to achieve established goals and (2) sions even with respect to the same cases (there
updating consisting of changes to meet new are examples across the volumes) and under-
demands or risks (Pierson 2001:419-427). mines the possibilities of cumulative research on
This scheme is definitely an advance contemporary welfare state reform. To compli-
compared to an implicit single continuum, and cate matters further, definitions and conceptua-
more than the other authors, Pierson attempts lizations of radical change have shifted over
to clarify what welfare state restructuring time. In the earlier literature, retrenchment was
involves. Equally important, the notion of often associated with cuts in expenditures but
recalibration and its specification addresses a not necessarily altering the nature of social
major flaw of the earlier analysis of welfare state
programmes, while restructuring has conveyed
retrenchment. The overriding assumption of the idea of more sweeping changes and pro-
contraction has precluded consideration of an gramme redesign. Now Pierson suggests that
expansion of entitlements, but reforms of the retrenchment is synonymous with radical
1980s and 1990s have often included cutbacks restructuring (Pierson 2001:419).
and extension of benefits (e.g. Merrien & Bonoli On a theoretical level, the difficulties are
in Kuhnle 2000).5 compounded by an institutionalist approach.

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which is better equipped to analyse stability
than change. A few of the authors voice
dissatisfaction with conclusions in recent writ-
ings emphasizing institutional resilience; that is,
reforms have not altered the basic features of the
welfare state. They question whether the
assumptions and focus of institutional frame-
works can capture varieties of change, and in
particular radical transformations (van Kers-
bergen in Kuhnle 2000; Palier in Ferrera &
Rhodes 2000). Kees van Kersbergen points to
several shortcomings. One problem is the
phenomenon of incremental shifts that can
produce radical change in the long run.
Conversely changes that qualify as restructur-
ing do not necessarily produce a fundamentally
different outcome. As an illustration, he notes
that making sickness benefits the responsibility
of employers in The Netherlands did not change
coverage or levels of benefits. In summary, van
Kersbergen makes a strong argument that the
institutional approach has underestimated the
capacity of certain external forces, especially
European economic integration, to produce a
series of minor changes that over time have
transformative consequences. His discussion on
what constitutes transformative change and
how to determine that changes are transforma-
tive is less convincing, however. Radical trans-
formation is defined as the abolition of core
programmes, the replacement of the institu-
tional logic by an entirely new one, or goal
failure - in this case the failure of policies to
guarantee and provide social protection.
Bruno Palier presents a framework that
distinguishes between three kinds of policy
change: changes within a particular policy
instrument, changes in policy instruments,
and changes in policy goals. A paradigmatic or
structural change encompasses all three kinds
of policy change simultaneously and involves a
new political logic (Palier in Ferrera & Rhodes
2000:114). He uses this framework to analyse
French policies during the past twenty-five
years, arguing that all three types of change
occurred. Most essential here is his argument of
the occurrence of paradigmatic change signal-
ling fundamental change in the French welfare
state. It is worth noting that one of the
structural changes - the introduction of RMI
(Revenu Minimum d'Insertion) - was initially a
crucial addition to existing arrangements rather
than a transformation. In fact, several innova-
tions are often of this type. What is critical,
however, is that a particular policy has the
'structural force' of a new political logic (Palier
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Welfare State Challenges and Responses 261
2000:134) or triggers the dynamics for a new
trajectory (Goul Andersen in Kuhlne 2000:80).
In effect, a few authors seek to identify a
formative moment or, more aptly, a formative
policy that entails a new logic (Myles & Pierson
in Pierson 2001).
Finally, compared with the earlier litera-
ture, there has been a shift in the assumptions
about the type of change that retrenchment
could produce. The assumption that the politics
of retrenchment would lead to sweeping change
has given way to consensus about incremental
change as the most likely development. This is
especially evident in Pierson's (2001:chapter
13) most recent scheme to analyse welfare state
restructuring that conceptualizes change as a
continuum spanning the status quo to radical
restructuring. He notes that maintaining the
status quo and radical restructuring seldom are
outcomes, and that most policy reforms fall
within a narrower spectrum between the two.
4. The effectiveness of responses
Rather than assessing the responses in terms of
types of change, the two volumes comprising
Welfare and Work in the Open Economy deal with
whether the adopted policies are effective
responses to the challenges caused by increas-
ing internationalization of the economy. By
comparing policy performance across twelve
welfare states, the authors attempt to identify
effective policy responses and failures. The time
frame of three decades allows the authors to
examine countries that have managed a suc-
cessful turnaround and to analyse the condi-
tions of their success. At the same time, the
advantages of a long time frame underline the
importance of the time perspective to conclu-
sions about success and failure as well as the
overall effectiveness of a country's policy
responses. Different time frames also contribute
to conflicting evaluations about the nature of
welfare state responses.
5. The political dynamics shaping
responses
The New Politics of the Welfare State, and
especially its editor, Paul Pierson, asserts that
the political dynamics of mature welfare states
are very different from those of welfare state
expansion, and that theories developed to
explain the growth of the welfare state offer a
262 ACTA SOCIOLOGICA 2001 VOLUJME 44

poor guide to understanding the contemporary
period.7 Very briefly, according to Pierson, the
massive scale of the welfare state has created a
new politics with a distinctive set of problems,
actors and strategies. The contemporary period
is an era of permanent austerity that generates
unprecedented strains on mature welfare states,
and in turn alters the goals of policy-makers
from expansion to cutbacks. The social pro-
grammes of mature welfare states also trans-
form patterns of interest-group formation as
beneficiaries organize into strong constituen-
cies. The shift in goals from growth to contrac-
tion is accompanied by policy-makers adopting
new strategies of blame avoidance, minimizing
transparency, and consensus building around
unpopular reforms. Furthermore, Pierson holds
that an institutionalist approach is extremely
useful in analysing the new politics - in
particular formal institutional veto points and
policy legacies.
Popular opinion is a key ingredient of the
'new politics' framework in that it acts as a
major constraint to reforms and innovative
responses. The altered role of public opinion
stems from the unpopular nature of cuts in the
welfare state, whereas welfare state expansion
involves introducing popular policies. In short,
popular support is a major source of the
resilience of welfare states.
Despite its importance, popular opinion is
not the focal point of The New Politics of the
Welfare State but it is the main topic of The Endcountries.
the Welfare State? The essays in this book confirm his own discussion of the strategic configuration
ideological resilience or inertia. They provide
ample evidence of the popularity of welfare
policies as well as support of existing social
policy arrangements and traditional forms of
state intervention across industrial nations in
the 1990s. They also show that welfare state
regimes have the potential to structure popular
opinion so that preferences reflect current
provision (Forma & Kangas; Matheson & Wear-
ing in Svallfors & Taylor-Gooby 1999. Cf.
Svallfors 199 7). At the same time, the general
pattern of attitudes is quite similar irrespective social accords have been key elements in
of the welfare state regime. These conflicting
results raise doubts about the importance of
popular opinion per se in putting a brake on
reforms. Rather dissimilar policies despite com-
mon attitudes indicate the pivotal position of
political elites in translating popular opinion
into public policies through articulating and
packaging preferences and building alliances of
support (cf. Ross in Ferrera & Rhodes 2000).
In the analyses of this volume, high levels Pierson, really a new phenomenon that is
of support were found for the welfare state, but
they also point to cracks in the support.
Growing worries about the long-term economic
viability of a generous welfare state may under-
mine policies even among those who endorse a
large public sector (Goul Andersen in Svallfors &
Taylor-Gooby 1999). A more serious trend is
the divergence between the attitudes of a
majority of the citizens and elites in Scandina-
via. Retrenchment in Sweden during the 1990s
led to a surge in welfare state support in the
working and middle classes, while elite opinion
grew increasingly critical of the welfare state. A
wide gap in the attitudes toward welfare services
of citizens and local government elites (both
politicians and administrators) was also docu-
mented in Finland (Svallfors; Blomberg & Kroll
in Svallfors & Taylor-Gooby 1999). Instead of a
legitimacy crisis of the welfare state, politicians
may face a crisis in their credibility.
The iNew Politics of the Welfare State focuses
on the strategic configuration of party systems,
new social pacts or 'competitive corporatism',
formal and informal institutions, veto sites and
players, and policy feedback processes. By
addressing the issue of a new politics, the book
offers a more rounded framework of the political
dynamics shaping responses. As distinct from
several of the other books whose chapters deal
with a single country or compare two or three
countries, this book centres on explanatory
factors and their influence across several
of However, as Kitschelt comments on
of party systems, several chapters provide an
explanation that emphasizes a single factor or a
limited set of factors rather than a multivariate
explanatory model. These chapters provide
insight into the importance of the explanatory
factors in a number of cases but cannot account
for countries that do not fit the explanation.
Furthermore, the framework does not seem
to differ so much from the dominant explana-
tions of welfare state expansion - a premise of
the book. For example. parties, corporatism and
accounts of the growth of welfare states.
Interestingly, in the past few years, the left
parties seem to have assumed a special role in
contemporary welfare state restructuring, remi-
niscent of their former position during expan-
sion. Likewise, in a path-breaking study of veto
sites, Ellen Immergut (1992) sought to explain
variations in the expansion of national health
insurance. And is recalibration, as defined by

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specifically related to welfare state contraction?
Were not changes to meet new demands and
risks as well as the adoption of new ideas to
achieve established goals equally important in
the dynamics of welfare state expansion?
Finally, the new politics framework tends to
downplay political agency and the leadership
factor (Ross in Ferrera & Rhodes 2000) as well
as the role of ideology, values and normative
discourse in the dynamics of policy reform
(Schmidt in Scharpf & Schmidt 2000; Cf.
Rothstein in Kuhnle 2000). Fiona Ross stresses
that the standard methods of effective policy
leadership characteristic of the previous era of
expansion are highly relevant in understanding
the current politics of welfare reform. Indeed,
the recent German pension reform and Chan-
cellor Gerhard Schroeder's leadership confirm
this point, especially in the light of many
authors' conclusion of reform immobilism in
Germany. In the new politics framework,
ideology and values are conceptualized as a
constraint and largely as a given. The long-term
success of fundamental welfare state reforms, as
argued by Vivien Schmidt, requires a change in
the underlying definition of moral appropriate-
ness, and thus it is vital to bring normative
discourse into the analysis.
6. Prescriptions and choices
The ideological preferences and country-specific
orientations of the authors often produce
contending views about how to achieve welfare
in the future. The editors of Recasting European
Welfare States offer an agenda for a sustainable
European welfare state. Their policy recommen-
dations consist of selective deregulation of the
labour market to enhance flexible (part-time or
temporary) service sector employment; 'in-
work' benefits, including tax credits; a substan-
tial reduction of social contributions of low-paid
workers; a closer link between contributions
and benefits; and a two-tier system of social
protection consisting of universal benefits and
benefits which are linked to income-related
contribution (Ferrera & Rhodes 2000:257-
282). In sum, a large part of their agenda for
reform resembles the British Prime Minister,
Tony Blair's 'third way' combined with con-
certation or consultation with major interests.
Nonetheless, there is a tension between this
general agenda for reform and the other
contributions to the volume, along with the
other books discussed here (Esping-Andersen
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Welfare State Challenges and Responses 263
1999; Scharpf & Schmidt 2000; Pierson 2001)
that underscore the diversity of challenges to
specific welfare states and to specific welfare
state regimes.
The new interventionism - one of the
alternative responses envisioned by Taylor-
Gooby - involves policies 'to improve the quality
and motivation of the workforce, in terms of
training and education, regulation of industry
and support of research and development,
coordination of efforts in new markets or
innovation and the promotion of social cohe-
sion, which will reduce the costs of social
control and help workers accept and accom-
modate greater flexibility in the labour market'
(Svallfors & Taylor-Gooby 1999:5-6).
An even broader form of new intervention-
ism is propounded by Esping-Andersen who
attempts to rewrite the egalitarian agenda and
imagine a new social contract relevant to
postindustrial society and its particular set of
risks. One of his major recommendations is a
positive sum 'win-win' adjustment strategy that
seeks to manage new risks so that no group
becomes a systematic loser. More specifically,
this entails policies that avoid chronic entrap-
ment in unemployment and poverty. The other
major recommendation is a shift in welfare state
efforts to younger households and especially the
servicing needs of young families (Esping-
Andersen 1999:6-10 and chapter 8).
A cautious argument advanced in some of
the essays in Survival of the European Welfare
State is that comprehensive welfare states may
have a comparative advantage in a competitive
world (Kuhnle 2000:236-7. Cf. Scharpf 2000
and Scharpf in Scharpf & Schmidt 2000). To
spell out the argument, comprehensive welfare
states of the Scandinavian type have high
labour-market participation rates in general,
and especially among women and older work-
ers. With the exception of Norway, there is little
short part-time work (under 20 hours per
week). In other words, a larger proportion of
the working age population is in the workforce,
jobs provide decent earnings, and both
strengthen the revenue base of the welfare
state. High total employment contrasts with
continental Europe, and even with the 'Dutch
miracle' where a substantial share of the
growth in employment consists of 'stand-by'
jobs and short part-time work. Moreover, two-
earner households lessen economic vulnerabil-
ity in times of adversity. The policies of the
Scandinavian welfare states also contribute to
labour-market flexibility. As distinct from frag-
264 ACTA SOCIOLOGICA
mented pensions tied to occupations, uniform
pension programmes with comprehensive cov-
erage promote labour mobility. A change in
employer or vocation does not entail a pension
penalty. Active labour-market measures
improve the skills of the workforce and the
options of individual workers. In the Danish
case, an unusual combination of little legisla-
tion to protect job security and generous
unemployment benefits has enhanced flexibility
on the labour market (Goul Andersen in Kuhnle
2000). The heavy reliance on general revenues
rather than contributions lowers labour costs.
Generous parental benefits and expanding
provision of childcare encourage higher fertility
rates. Finally, despite the severe recessions and
high unemployment rates in Finland and
Sweden in the 1990s, poverty rates remained
low; and the four welfare states demonstrated
continuing strong redistributive capacities
through transfers and taxes.
7. Concluding remarks
Despite some overlap in terms of both contribu-
tors and content, these volumes largely comple-
ment one another. In part, this occurs because
the editors of the collections represent different
perspectives. Moreover, the dialogue between
contributions of the various collections is often
much richer than the crosstalk of essays in the
same volume. In several instances the pieces
speak to one another, confirming or contesting
underlying assumptions and empirical results.
Among the contested areas are the claim of the
'new' politics of the welfare state, the type of
change involved in welfare state responses, the
merits of an institutional approach, country-
specific outcomes, and popular support of the
welfare state.8
Taken together, the books document more
variation in welfare state challenges and pro-
blem-solving responses than earlier assumed,
especially in the light of the globalization and
convergence theses. Echoing the conclusion of
Fiona Ross, the forces of resistance to welfare
state change - programme constituencies and
institutional inertia in the form of veto sites and
path-dependent effects - differ significantly
across and within welfare state regimes (Ross
in Ferrera & Rhodes 2000:30). Or as summar-
ized by Pierson, 'there is not a single "new
politics" of the welfare state, but different
politics in different configurations' (Pierson
2001:14). It is also worth adding that consti-
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2001 VOLUME 44
tuencies and institutional inertia vary across
programmes and policy areas within the same
country (Bashevkin 2000; Anderson (forth-
coming)). In turn, these variations suggest
that if welfare state researchers aspire to
policy-relevant prescriptions, they will need to
develop more accurate and country-specific
diagnoses of the welfare predicament.
On the other hand, the books raise
unanswered questions and point to conflicting
results. In this way and through their omis-
sions, they indicate a number of issues that
should be placed at the top of the research
agenda. For example, ethnicity is completely
overlooked in this most recent wave of welfare
state scholarship. With the major exception of
Esping-Andersen's incorporation of the family
into his welfare regime typology, gender is also
largely missing.9 In discussing the pressures on
mature welfare states, Pierson also includes
the transformation of household structures
(2001:94-99). Yet he dismisses inclusion of
the interplay between the state, market and
family/household in his analytical scheme of
welfare state restructuring, arguing that its
inclusion excessively broadens the concept of
the welfare state, and that such stretching
makes for confusion (2001:420). Part of his
reasoning is based on a feminist critique that
argues for a conceptualization of the welfare
state that is not limited to income maintenance
policies. Another aspect of the feminist critique,
hovwever, focuses explicitly on income mainte-
nance policies and their gendered effects. More-
over, gender is central to the analysis of welfare
state structuring, and feminist research has
shown its differing impacts on women and men
(O'Connor et al. 1999; Sainsbury 1996). Why
should welfare state restructuring deal with
recommodification and not refamilialization of
benefits?
Perhaps most pressing, however, is the
necessity to rethink retrenchment and restruc-
turing. Comparativists, in grappling with the
'welfare state crisis', have pushed forward the
frontiers of research, and they have devised a
variety of conceptual tools to analyse the
remaking of welfare states. However, if we are
to make sense of welfare state responses and
their politics, we need a clearer specification of
the concepts of retrenchment and restructuring
since they often form the dependent variable of
our analyses. Until this happens, the question of
whether responses entail institutional and
ideological resilience or restructuring will
remain unresolved.

Notes
1 The volumes cover a wide range of countries with
Western Europe as the focal point. Recasting European Welfare
States examines the Scandinavian countries, France, Italy,
Britain, The Netherlands, Belgium and Spain. The Survival of
the European Welfare State deals with the same countries, except
Belgium, plus Switzerland, Australia and New Zealand. Only The
End of the Welfare State? includes Eastern European countries,
mainly Poland, but it examines popular opinion and values. The
following twelve countries are analysed in Welfare and Work in
the Open Economy: Australia, Austria, Belgium, Denmark,
France, Germany, Italy, The Netherlands, New Zealand, Sweden,
Switzerland and Britain. The New Politics of the Welfare State has
a wider scope, including most of the countries listed above but
also the United States, Canada and Japan. Finally, Social
Foundations of Postindustrial Economies utilizes data from at
most 19 OECD countries, including Portugal and Ireland.
2 For a detailed assessment of the challenges posed by
ageing populations to welfare states, see Castles (2001).
3In the social democratic welfare state regime, both
mothers' and fathers' entitlements have been successively
strengthened through earnings-related benefits with high
replacement rates and long benefit periods; in the conservative
regime, flat-rate care allowances, precluding utilization by
fathers, are common; and the norm in the liberal regime is
occupational benefits provided by employers.
4Not all the authors of the volume concur with this
judgement, since their analysis shows that 'in the "struggle for
survival" radical departures . .. cannot be excluded' (Hemerijck
et al. in Kuhnle 2000:125).
5Part of the failure to consider the extension of entitle-
ments has resulted from this research's concentration on
cutbacks in major income maintenance programmes and
entitlements based on paid work. There has often been no
analysis of benefits based on the principle of care, which in many
countries expanded during the 1980s and 1990s (for example,
see Sainsbury 1996).
6 In reconsidering decommodification, Esping-Andersen
acknowledges a problematic duality: 'Inherently, the concept
presupposes that individuals - or their welfare acquisitions - are
already commodified (1999:43-45, quotation: p. 44).
7In an earlier work, Pierson (1996) stated more empha-
tically that theoretical frameworks to analyse the expansion of
welfare states could not be inverted to explain the new politics of
retrenchment, whereas he now calls for the integration of this
problematic into traditional theories of welfare states.
8For different opinions on the newness of the new politics Svallfors, S. 1997. Worlds of Welfare and Attitudes to
of the welfare state (Ross in Ferrera & Rhodes 2000 and Pierson
in Pierson 2001), the institutional approach (van Kersbergen in
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Welfare State Challenges and Responses 265
Kuhnle 2000 and Sweet in Pierson 2001), country-specific
outcomes (e.g. Kitschelt's assessment on Denmark in Pierson
(2001) and Goul Andersen in Kuhnle (2000) or Eitrheim &
Kuhnle in Kuhnle (2000) and Benner & Vad in Scharpf &
Schmidt (2000)), and popular support (Kitschelt in Pierson
2001; Taylor-Gooby & Svallfors 1999).
9 Moreover, Esping-Andersen points out that his focus is on
families and households - not gender relations (1999:49-51).
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