Welfare systems

The chapter provides an analysis of the welfare states in the four growth models. In terms of public and social spending, the non-inclusive growth (NIG) countries record the highest values, while on the opposite side, we find the non-inclusive low growth (NILG) countries. Concerning pensions, the NILG countries show the highest share of pension spending and guarantee very generous replacement rates, followed by the dualistic inclusive growth (DIG) countries. The values displayed by the egalitarian inclusive growth (EIG) and NIG are more contained both in terms of expenditure and generosity. Regarding the policies against poverty, the EIG countries are the most effective in reducing poverty rates, followed by those of the DIG, while the NIG and NILG ones show high poverty rates both before and after transfers. Shifting the focus on family policies, the EIG countries are the only ones that allocate more resources on services than on monetary transfers. Finally, concerning health policy, in almost all countries, coverage is universal, except for the United States. However, there are different sources of financing for health expenditure. The analysis thus confirms four well-defined and distinguishable welfare states that imply equally different redistributive capacities.