The Demand for Social Insurance: Does Culture Matter?

University of Zurich Department of Economics Working Paper No. 41

40 Pages Posted: 12 Nov 2011

See all articles by Beatrix Brügger

Beatrix Brügger

University of Lausanne

Rafael Lalive

University of Lausanne - Department of Economics; IZA Institute of Labor Economics; CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Andreas Steinhauer

University of Zurich

Josef Zweimüller

University of Zurich - Department of Economics; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); IZA Institute of Labor Economics

Date Written: October 1, 2011

Abstract

Can different social groups develop different demands for social insurance of risks to health and work? We study this issue across language groups in Switzerland. Language defines social groups and Swiss language groups are separated by a clear geographic border. Actual levels of social insurance are identical on either side of the within state segments of the language border. We can therefore study the role of culture in shaping the demand for social insurance. Specifically, we contrast at the language border actual voting decisions on country-wide changes to social insurance programs. Key results indicate substantially higher support for expansions of social insurance among residents of Latin-speaking (i.e. French, Italian, or Romansh) border municipalities compared to their German-speaking neighbors in adjacent municipalities. We consider three possible explanations for this finding: informal insurance, ideology, and the media. We find that informal insurance does not vary enough to explain stark differences in social insurance. However, differences in ideology and segmented media markets are potentially important explanatory factors.

Keywords: Culture, language, preferences for social insurance, spatial regression discontinuity

JEL Classification: J21, J64, Z10

Suggested Citation

Brügger, Beatrix and Lalive, Rafael and Steinhauer, Andreas and Zweimueller, Josef, The Demand for Social Insurance: Does Culture Matter? (October 1, 2011). University of Zurich Department of Economics Working Paper No. 41, Available at SSRN: https://ssrn.com/abstract=1958181 or http://dx.doi.org/10.2139/ssrn.1958181

Beatrix Brügger (Contact Author)

University of Lausanne ( email )

Quartier Chambronne
Lausanne, Vaud CH-1015
Switzerland

Rafael Lalive

University of Lausanne - Department of Economics ( email )

Batiment Internef
Lausanne, 1015
Switzerland

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Poschinger Str. 5
Munich, DE-81679
Germany

Andreas Steinhauer

University of Zurich ( email )

Rämistrasse 71
Zürich, CH-8006
Switzerland

Josef Zweimueller

University of Zurich - Department of Economics ( email )

Zuerich, 8006
Switzerland
+411 634 3724 (Phone)
+411 634 4907 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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