Changing Systems of Social Protection in the Context of the Changing Political Economies since the 1980s

Abstract

Abstract This article provides an overview of the profound changes in the more advanced welfare states in Europe and Latin America over the past 35 years. Deindustrialization, informalization, and the rise of unstable employment, combined with aging populations rendered traditional employment-based models of social protection less effective and at the same time increased demands on the welfare state. The two main responses to these challenges were efforts at cost containment and inclusion in non-contributory social protection schemes and health services of those in marginal labor market positions. The mix of these two responses and the depth of the changes were shaped by the intensity of the economic and demographic pressures, policy legacies, the partisan preferences of governing parties and coalitional constraints, the strength of groups in civil society, the presence of veto points in the political system, and in Latin America the process of democratization, along with the international context. A broad comparison between Latin America and Europe highlights the importance of the international context in the form of a relentless pursuit of neoliberal models by the International Financial Institutions in Latin America in contrast to the model of Social Europe promoted by the European Union.