Welfare State Myths and Measurement

26 Pages Posted: 20 Sep 2015

See all articles by Irwin Garfinkel

Irwin Garfinkel

Columbia University - School of Social Work

Timothy M. Smeeding

University of Wisconsin - Madison

Date Written: July 11, 2015


Myths about welfare states and their effects on economic development abound. In this paper, we rebut three central, related myths: that the current American welfare state is unusually small, that the United States has always been a welfare state laggard, and that the welfare state undermines productivity and economic growth. Very reasonable changes in measurement reveal that all three beliefs are untrue. The American welfare state appears relatively small only by restricting the comparison to rich nations, ignoring employer-provided health insurance, pensions, and public education, and measuring size relative to GDP, rather than on a real per capita basis. The inclusion of public education turns the United States from a laggard to a leader in welfare state development. Including public education and public health as well as cash benefits suggests that welfare state programs as a whole enhance the productivity of capitalism and spur economic development.

Comments on this paper can be found at: http://ssrn.com/abstract=2566430.

Suggested Citation

Garfinkel, Irwin and Smeeding, Timothy M., Welfare State Myths and Measurement (July 11, 2015). Capitalism and Society, Volume 10, Issue 1, Article 1, 2015, Available at SSRN: https://ssrn.com/abstract=2629585

Irwin Garfinkel (Contact Author)

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Timothy M. Smeeding

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HOME PAGE: http://www.lafollette.wisc.edu/facultystaff/smeeding-timothy.html

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