The Welfare State Besides Globalization Forces
49 Pages Posted: 21 Aug 2018
Date Written: August 2018
Globalization - a widespread contemporaneous phenomenon - generates international tax competition. The consequent erosion in the tax base, especially on capital, is a blow to the finances of the welfare state, with far-reaching implications for the redistribution of income by the welfare state. Low skill migration attracted to the welfare state may put additional strain on it. An aging welfare state - a common contemporary phenomenon in many industrial countries - calls in for young and high skill immigrants for its survival. This review is about how economists should think about the connection between globalization and the welfare state, with strong motivating historical examples and empirical facts, and non-technical analytics.
JEL Classification: F00, H00
Suggested Citation: Suggested Citation