This course aims to provide both a macro view of welfare state debates in Australia and internationally – including Asia and the Pacific, as well as Europe and North America – and also develop skills in undertaking quantitative analysis of selected major policy issues such as the causes of the growth of public spending, measures to control expenditure growth, and how to analyse the effectiveness of welfare state spending, particularly in relation to impacts on income distribution (inequality and income poverty), as well as unintended consequences. Emphasis is on a comparative approach.

Questions to be addressed include:

• How expensive is the Welfare State?
  • Issues to be dealt with include the growth in welfare spending in Australia and internationally and the causal factors associated with these trends; issues of definition of the welfare state, including the relationship between public and private welfare, and occupational welfare, and the role of the tax system and its interactions with public spending.
• How effective is the Welfare State?
  • What are the impacts of social spending and taxation on income inequality and poverty, moving from cash benefits and personal taxes to government provided services and indirect taxes; does the welfare state have unintended consequences that undermine redistribution through impacts on incentives to work and save and form families; does the welfare state have indirect positive effects on social performance, boosting social solidarity and other wellbeing outcomes.
  • What are the social policy challenges facing developing Asian and Pacific countries in coming decades, including trends in inequality and the consequences of population ageing and demographic change? Is there an Asian social policy model or models that can deal effectively with these challenges?  Are the policy approaches developed and used in OECD countries relevant to Asia and the Pacific. What are appropriate the analytical frameworks and tools to assess these questions?

• Is the Welfare State sustainable?

The financial crisis in North Atlantic economies has resulted in significant growth in public spending in many countries and falling tax revenues, leading to higher public debt.  Some countries have embarked on austerity packages.  These trends coincide with the first cohort of the baby boom population reaching age 65, and projected further substantial increases in welfare state spending on pensions, health care and services for the frail aged. What does this combination of trends mean for the sustainability of the welfare state in Australia and internationally?

Learning Outcomes

Upon successful completion, students will have the knowledge and skills to:

1. a) Find and use key sources of data on social security and welfare spending in Australia and internationally, including Asia and the Pacific as well as OECD countries
2. b) Understand key conceptual frameworks regarding social spending, as well as frameworks for the analysis of distributional effects of public spending
3. c) Demonstrate a knowledge of methodological issues in the analysis of the effects of government welfare state spending on key social outcomes including inequality and poverty
4. d) Analyse and assess alternative approaches to social policy interventions
5. e) Compare the social protection systems of their own or other countries with those of other rich or developing nations

Staff Feedback

Students will be given feedback in the following forms in this course:

• Written comments
• Verbal comments
• Feedback to the whole class, to groups, to individuals, focus groups

Student Feedback

ANU is committed to the demonstration of educational excellence and regularly seeks feedback from students. Students are encouraged to offer feedback directly to their Course Convener or through their College and Course representatives (if applicable). The feedback given in these surveys is anonymous and provides the Colleges, University Education Committee and Academic Board with opportunities to recognise excellent teaching, and opportunities for improvement. The Surveys and Evaluation website provides more information on student surveys at ANU and reports on the feedback provided on ANU courses.

Class Schedule

Week/Session	Summary of Activities	Assessment
1	9 April: Introduction: The welfare state debate internationally and nationally	Introduction: The welfare state debate internationally and nationally This session sets out the main issues to be covered in this course and introduces the diversity of perspectives that exist on these issues. The discussion outlines some of the controversies in debates about the welfare state and wellbeing in rich and developing countries, and sets out the analytical tools that can be used in addressing these questions. Students are expected to read the following two articles. John Myles and Jill Quadagno (2002), Political Theories of the Welfare State, Social Service Review, Vol. 76, No. 1, pp. 34-57. Barr, N. (1992), 'Economic Theory and the Welfare State: A Survey and Interpretation', Journal of Economic Literature, Vol. 30, No. 2, June, pp. 741-803. Additional resources 3. Whiteford, P.(2006), The Welfare Expenditure Debate: Economic Myths of the Left and the Right Revisited, The Economic and Labour Relations Review, 17 (1), September, 33-78.
2	9 April: Assessing the scope of social spending: measurement and data sources	Assessing the scope of social spending: measurement and data sources This session discusses how we measure social policy inputs –how much is spent on different parts of the welfare state and how it has developed over time, both in terms of different social programmes and what are the driving forces behind these developments. The interrelationship between public spending and the tax system and forms of social protection not directly provided by government are discussed. Students should have familiarised themselves with the two main readings. Adrian Sinfield (1978), Analyses in the Social Division of Welfare, Journal of Social Policy, Volume 7, Issue 02, April 1978, pp 129-156. http://journals.cambridge.org/action/displayAbstract;jsessionid=5D157AA8F22670DFBC82D8B00A723972.journals?fromPage=online&aid=3295720 Adema, W. and Whiteford, P.(2010), Public and private social welfare, in Castles, F., Leibfried, S., Lewis, J., Obinger H., and Pierson, C., (eds.) Oxford Handbook of the Welfare State, Oxford University Press, 139-51. Additional resources: Herbert Obinger, Uwe Wagschal, (2010) “Social Expenditure and Revenues” The Oxford Handbook of the Welfare State, Francis G. Castles, Stephan Leibfried, Jane Lewis, Herbert Obinger, and Christopher Pierson, Oxford Handbooks Online. Adema, W., P. Fron and M. Ladaique (2011), “Is the European Welfare State Really More Expensive? Indicators on Social Spending, 1980-2012; and a Manual to the OECD Social Expenditure Database (SOCX)”, OECD Social, Employment and Migration Working Papers, No. 124, OECD Publishing. http://dx.doi.org/10.1787/5kg2d2d4pbf0-en Asian Development Bank (2011), The Revised Social Protection Index Methodology and Handbook, http://www.adb.org/sites/default/files/spi-handbook.pdf
3	12 April: Monitoring Trends in Poverty and Income Distribution: Data, Methodology and Measurement	Monitoring Trends in Poverty and Income Distribution: Data, Methodology and Measurement This session is intended to give a sound grounding in the methodology for measuring poverty and income inequality and the main conceptual and practical issues involved in making quantitative assessments of poverty and inequality trends. This will cover issues such as the income concept, equivalence scales, the time period, the unit of measurement, alternative approaches to measuring poverty and the most common methods of measuring inequality. Saunders, Peter and Bradbury, Bruce (2006), Monitoring Trends in Poverty and Income Distribution: Data, Methodology and Measurement, Economic Record, 82, 258, 341- 364. Miles Corak (2005), Principles and Practicalities for Measuring Child Poverty in the Rich Countries, International Social Security Review, 2006, 59 (2), 3-36, http://www.iza.org/en/webcontent/publications/papers/viewAbstract?dp_id=1579 Additional resources UNICEF (2011), Child Poverty in East Asia and the Pacific, Deprivations and Disparities, http://www.unicef.org/eapro/Child_Poverty_in_EAP_Regional_Report.pdf
4	12 April: Measuring the impact of the welfare state on poverty and inequality	Measuring the impact of the welfare state on poverty and inequality Government policies in all countries affect the distribution of household income. They do so through a range of programmes but most directly through the cash transfers paid to households and the direct taxes and social security contributions collected from them. However, different welfare states may pursue a variety of social objectives, with the balance and priority given to each of them varying across both countries and between programmes. This session will discuss the frameworks and methods used to assess the redistributive impact of the welfare state. Whiteford, P. (2010), "The Australian Tax€ ?Transfer System: Architecture and Outcomes," The Economic Record, vol. 86(275), pages 528-544, December. Korpi, W. and J. Palme (1998), ‘The Paradox of Redistribution and Strategies of Equality: Welfare State Institutions, Inequality, and Poverty in the Western Countries’, American Sociological Review, Vol. 63, No. 5 (Oct., 1998), 661-687. Additional resources Bastagli, F., D. Coady, and S. Gupta, (2012), “Income Inequality and Fiscal Policy,” IMF Staff Discussion Note 12/08 (Washington: International Monetary Fund). www.imf.org/external/pubs/ft/sdn/2012/sdn1208.pdf Michael Forster & Peter Whiteford, (2009). "How much Redistribution do Welfare States Achieve? The Role of Cash Transfers and Household Taxes," CESifo DICE Report, Ifo Institute for Economic Research at the University of Munich, vol. 7(3), pages 34-41, October. Ive Marx, Lina Salanauskaite, Gerlinde Verbist (2013), “The Paradox of Redistribution Revisited: And That It May Rest in Peace?” IZA DP No. 7414, May 2013.
5	16 April: Broadening the framework for measuring redistribution: What do fiscal incidence studies tell us? What is the impact of wealth and private provisions?	Broadening the framework for measuring redistribution: What do fiscal incidence studies tell us? What is the impact of wealth and private provisions? Most income surveys include information only on cash transfers and direct taxes, which form different fractions of overall government activity in different countries. Most standard comparative studies ignore the impact of broad-based consumption taxes and government non-cash benefits such as health, education and public housing. Consumption taxes tend to be regressive by income, and are much higher in large welfare states than in small welfare states. Non-cash benefits tend to be less progressive than targeted or universal cash transfers, but vary in significance by less than cash benefits. This session will discuss the methodology for incorporating these broader measures of government activity into the accounting framework discussed in the previous session, and will also take into account the relationship between wealth and income. OECD (2008), Chapter 9, pp. 223-251, Growing Unequal: Income Distribution and Poverty in OECD Countries, OECD, Paris. Philip Armour, Richard V. Burkhauser, and Jeff Larrimore (2013), Deconstructing Income and Income Inequality Measures: A Crosswalk from Market Income to Comprehensive Income American Economic Review: Papers & Proceedings 2013, 103(3): 173€“177http://dx.doi.org/10.1257/aer.103.3.173 Additional resources Atkinson, A. and E. Marlier (Eds), (2010), Income and Living Conditions in Europe, Eurostat, Brussels. http://epp.eurostat.ec.europa.eu/cache/ITY_OFFPUB/KS-31-10-555/EN/KS-31-10-555-EN.PDF Smeeding, T., Saunders, P., Coder, J., Jenkins, S., Fritzell, J. Hagenaars, A., Hauser, R., and Wolfson, M. (1992), Noncash Income, Living Standards and Inequality: Evidence from the Luxembourg Income Study, LIS Working Paper, CEPS/INSTEAD, Luxembourg. Falkingham, J. and Harding, A. (1996), Poverty Alleviation versus Social Insurance Systems: A Comparison of Lifetime Redistribution, Discussion Paper No. 12, NATSEM, University of Canberra.
6	16 April: Wealth and the Welfare State	Wealth and the Welfare State Most analysis of the impact of the welfare state focuses on the relationship between social spending and the level of income inequality or income poverty. But what is the relationship between welfare state design and the distribution of household wealth? Readings Francis Castles. The really big trade-off: home ownership and the welfare state in the new world & the old Jim Kemeny (2005) “The Really Big Trade€ ?Off” between Home Ownership and Welfare: Castles' Evaluation of the 1980 Thesis, and a Reformulation 25 Years on, Housing, Theory and Society, 22:2, 59-75, DOI: 10.1080/14036090510032727 To link to this article: https://doi.org/10.1080/14036090510032727 Additional resources Credit Suisse, Global wealth Report 2017, https://www.credit-suisse.com/corporate/en/research/research-institute/global-wealth-report.html
7	19 April: Incentives and the welfare state: does welfare create dependency?	Incentives and the welfare state: does welfare create dependency? Does the welfare system itself induce dependency, and, worse, intergenerational dependency? Critics of welfare state programmes argue that benefits do not alleviate poverty but they create it by changing the behaviour of the poor. As Mead (1997) argues, ‘more important than any economic factor as a cause of poverty…is what used to be called the culture of poverty’. Alternatively, can the welfare state be a positive sum game increasing both equity and economic efficiency? This session will discuss these arguments and the evidence for them, as well as arguments about the macro-economic effects of the welfare state. 1.Charles Murray (1985), Have the Poor Been "Losing Ground"? Political Science Quarterly Vol. 100, No. 3 (Autumn, 1985), pp. 427-445. http://www.jstor.org/discover/10.2307/2151066?uid=3737536&uid=2129&uid=2&uid=70&uid=4&sid=21102116832663 2.Peter H. Lindert (2003), Why the Welfare State Looks like a Free Lunch, Working Paper 9869, http://www.nber.org/papers/w9869 Additional Resources Robert Moffitt (1992), “Incentive Effects of the U.S. Welfare System: A Review”, Journal of Economic Literature, Vol. 30, No. 1 (Mar., 1992), pp. 1-61. Peter Saunders (Ed) (2000), Reforming the Australian Welfare State, Australian Institute of Family Studies,http://www.aifs.gov.au/institute/pubs/saunders4.html Desmond King, Fiona Ross (2010), “Critics and Beyond” in The Oxford Handbook of the Welfare State, Francis G. Castles, Stephan Leibfried, Jane Lewis, Herbert Obinger, and Christopher Pierson (Eds), Oxford Handbooks Online. Institute for Research on Poverty (1985), Are we losing ground?Focus,http://www.irp.wisc.edu/publications/focus/pdfs/foc83a.pdf
8	19 April: Demographic and social policy challenges throughout the world	Demographic and social policy challenges throughout the world This session will focus on emerging social policy challenges in Asia and the Pacific including population ageing and demographic changes such as low fertility, rising inequality and entrenched gender inequalities. In the light of earlier discussion of existing social protection mechanisms, the session will discuss the likely effectiveness of these instruments in facing these challenges. Sidney B. Westley, Minja Kim Choe, and Robert D. Retherford (2010), “Very Low Fertility in Asia: Is There a Problem? Can It Be Solved?” AsiaPacific Issues, No. 94: May 2010. Asian Development Bank (2012), Asian Development Outlook 2012: Confronting Rising Inequality in Asia, pages 35-95. Additional Resources Joshua Eastin and Aseem Prakash (2013), Economic Development and Gender Equality: Is There a Gender Kuznets Curve? World Politics, 65, pp. 156-186. World Bank (2012), Toward gender equality in East Asia and the Pacific: a companion to the world development report, http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2012/11/01/000333037_20121101011811/Rendered/PDF/734380PUB0Box30ward0gender0equality.pdf
9	7 May: Welfare and Social Protection in the Global South: Asia and the Pacific and elsewhere	Welfare and Social Protection in the Global South: Asia and the Pacific and elsewhere This session will discuss the variety of systems of social protection in Asian and Pacific countries and their development over time. It will ask whether the welfare state is transferable from its origins in now rich countries or whether other approaches to welfare are more appropriate than state provisions. Ito Peng and Joseph Wong (2010), East Asia, in The Oxford Handbook of the Welfare State, Francis G. Castles, Stephan Leibfried, Jane Lewis, Herbert Obinger, and Christopher Pierson (Eds), Oxford Handbooks Online. Leisa Perch and Rathin Roy (2010), Social Policy in the Post-crisis Context of Small Island Developing States: a Synthesis, International Policy Centre for Inclusive Growth, United Nations Development Programme. Additional resources Salditt, F., Whiteford, P. and Adema W. (2008), Pension reform in China; International Social Security Review, 61 (3), July-September, 47-71. Asian Development Bank (2011), The Revised Social Protection Index Methodology and
10	7 May: Social protection and the future of work	Social protection and the future of work Changes in the nature of work pose challenges to the social security systems of high income countries, particularly those relying on contributory social insurance systems. These systems are based to varying degrees on workers satisfying contribution conditions that require or assume full-time engagement in paid work for the majority of years that individuals are in the labour force, together with formal arrangements for the payment and recording of contributions by employers and employees. They also often distinguish between employees and the self-employed. As temporary work and changing forms of employment contracts become more prevalent, the assumption of full-time, permanent formal employment threatens to become less accurate, potentially undermining welfare state finances as well as the social protection of workers and their families. Readings Artificial Intelligence and Its Implications for Income Distribution and Unemployment: Anton Korinek, Joseph E. Stiglitz (bibliographic info) (download) version of January 10, 2018 (Working Paper version) OECD (2017), Basic Income as a Policy Option https://www.oecd.org/els/soc/Basic-Income-Policy-Option-2017-Brackground-Technical-Note.pdf Is a universal basic income “challenging but possible”? Tim Dunlop 10 November 2017, Inside Story, http://insidestory.org.au/is-a-universal-basic-income-challenging-but-possible/
11	10 May: Controlling social spending: policies and outcomes	Controlling social spending: policies and outcomes Welfare state retrenchment is widely seen as a highly unpopular endeavour and as politically difficult to pursue. This assumption has underpinned most of the political science research on this issue, notably Paul Pierson's seminal contributions about the ‘new politics of the welfare state’. Yet, the question remains why and under what circumstances cutbacks take place in highly developed welfare states despite these formidable political obstacles. This session reviews the literature on the politics of retrenchment, namely on the impact of socio-economic problem pressure, political parties, political institutions, welfare state structures and ideas. Readings Peter Starke (2006), “The Politics of Welfare State Retrenchment: A Literature Review”, Social Policy & Administration, 40, 1, 104 –120. Korpi, Walter, and Joakim Palme (2003), “New Politics and Class Politics in the Context of Austerity and Globalization: Welfare State Regress in 18 Countries, 1975-95.” The American Political Science Review, vol. 97, no. 3, 2003, pp. 425–446. JSTOR, www.jstor.org/stable/3117618. Accessed 9 Mar. 2021. Additional resources Rawdanowicz, L., E. Wurzel and A. Christensen (2013), "The Equity Implications of Fiscal Consolidation", OECD Economics Department Working Papers, No. 1013, OECD Publishing. doi: 10.1787/5k4dlvx2wjq0-en Hagemann, R. (2012), “Fiscal Consolidation: Part 6. What Are the Best Policy Instruments for Fiscal Consolidation?”, OECD Economics Department Working Papers, No. 937, OECD Publishing. http://dx.doi.org/10.1787/5k9h28kd17xn-en
12	10 May: Is the welfare state sustainable?	Is the welfare state sustainable? Is the “age of entitlement” coming to an end as a result of the challenges of population ageing and rising public debt? Sustainability can be looked at from a number of perspectives including the willingness of populations to support higher taxes and the priority given to social policy concerns over other issues such as climate change. This session will explore a range of perspectives. Howard Glennerster (2007), The sustainability of western welfare states, CASE seminar paper, LSE Research Online, http://eprints.lse.ac.uk/3989/ Gosta Esping-Andersen (1998), The sustainability of welfare states into the 21st century, Papers de la fundacio/113, http://www.fcampalans.cat/uploads/publicacions/pdf/113.pdf

Assessment Summary

Assessment task	Value	Due Date	Return of assessment	Learning Outcomes
Data Analysis Exercise	10 %	12/04/2021	14/04/2021	1, 2
Briefing Note or Blog post	20 %	19/04/2021	23/04/2021	1,2,3
Data Analysis Exercise	10 %	07/05/2021	10/05/2021	1,2
Major Essay	60 %	24/05/2021	*	1,2,3,4,5

* If the Due Date and Return of Assessment date are blank, see the Assessment Tab for specific Assessment Task details

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The ANU is using Turnitin to enhance student citation and referencing techniques, and to assess assignment submissions as a component of the University's approach to managing Academic Integrity. For additional information regarding Turnitin please visit the ANU Online website Students may choose not to submit assessment items through Turnitin. In this instance you will be required to submit, alongside the assessment item itself, hard copies of all references included in the assessment item.

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Marks that are allocated during Semester are to be considered provisional until formalised by the College examiners meeting at the end of each Semester. If appropriate, some moderation of marks might be applied prior to final results being released.

Participation

20% of the total marks will be assessed on the basis of two data analysis exercises to be undertaken in class on 12 April and 7 May. Each will be worth 10% of the final mark.

Assessment Task 1

Data Analysis Exercise

A data analysis exercise will be undertaken in class on 12 April and will be worth 10% of the marks for the course. The data that will be analysed will be advised on the first day on 9 April.

Assessment Task 2

Briefing Note or Blog post

A 900 word Briefing Note or Blog post will be due on 19 April. A range of topics will be distributed in the first day of the course or students can consult the lecturer on the topic in the first week of the course to identify a social policy issue covered in the course and of contemporary relevance that they wish to either write as a Briefing Note to a Government Minister or as an analytical piece for an output like the Conversation.

Assessment Task 3

Data Analysis Exercise

A data analysis exercise will be undertaken in class on 7 May and will be worth 10% of the marks for the course. The data that will be analysed will be advised on 16 April.

Assessment Task 4

Major Essay

A 3,500 word essay will be due on 24 May and will constitute 60% of the overall assessment..Choose 1 of the following topics.

Topic 1: Compare and evaluate the design features and outcomes of the welfare state in at least two countries, with reference to the level of spending and taxing, and the system's efficiency and effectiveness in achieving the objectives of reducing inequality and poverty. Identify any major concerns with the chosen welfare states. 

(Choose from the following list: Australia, New Zealand, the United Kingdom, the United States, Sweden, Germany, Greece; Chile, China, Japan, Korea, Vietnam, Indonesia. If you wish to compare any other countries, please discuss with me.)

Topic 2: Is the welfare state as it currently exists in Australia and other high income countries sustainable over the next 30 years?

Topic 3: Can developing middle or low income countries develop welfare states like those existing in high income countries or are there other approaches to social protection that they should invest in?

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