The role of public sectors in modern welfare states: back seat to centre stage

Abstract

Contemporary welfare states have long been ‘in transition’. Since the inception of the ‘welfare state crisis’ argument around the 1970s, various debates on welfare mix have been introduced under the name of ‘mixed-economy of welfare states’, ‘welfare pluralism’, and ‘new public management’. In spite of there being slight differences, recent reforming trends during the last 30 years have been in favour of the role of private sectors whereas the public sector has been regarded as inefficient and less effective. In this context, this paper aims to challenge the conventional view in regards to the role of the public sector in modern welfare states and questions whether the larger public sector has been harmful to the performance of welfare states. Further, it will also discuss under what conditions the public sector of welfare states has performed well. In order to achieve this, firstly this paper will review a range of academic literature on recent welfare reforms with special attention given to the role of the public sector. Then, it will analyse changes in the performance of 20 OECDwelfare states from 1981 to 2010 using the fuzzy-set ideal type analysis. It will then analyse to what extent and when the public sector enabled the welfare states to perform well, using Fs/QCA(fuzzy-set/Qualitative Comparative Analysis). In consequence, this research aims to re-highlight the role of the public sector in modern welfare states and further to argue that the quality of public sectors within welfare states matters beyond simply the ‘size’.