Table of Contents

1   The Welfare State under Attack

1.1 Economists and the Welfare State

1.2 Working with, Rather than against, the Grain

1.3 Importance of Institutional Features

1.4 Political Economy

1.5 Structure of the Book

1.6 Limitations

2   Welfare State and Economic Performance: Aggregate Empirical Evidence

2.1 Different Hypotheses

2.2 Econometric Studies of Aggregate Growth Rates

2.3 Assessing the Findings about Growth Rates

2.4 Econometric Studies of Unemployment

2.5 Assessing the Findings about Unemployment

2.6 Conclusion

3   Equilibrium Models of the Labor Market

3.1 A Simple Competitive Equilibrium Model

3.2 Issues Raised

3.3 Models of Unemployment

3.4 Trade Unions and Unemployment

3.5 Unemployment Benefit

3.6 In Lieu of a Conclusion

4   Unemployment Insurance in a Segmented Labor Market

4.1 Real-World Unemployment Insurance

4.2 A Segmented Labor Market

4.3 Impact on Cuts in Unemployment Benefit

4.4 Conclusion

5   Public Choice and Unemployment Insurance

5.1 Changes in Unemployment Insurance

5.2 Voters' Support for Unemployment Insurance

5.3 Alternative to Voting Explanations

5.4 Conclusion

6   Savings, Pensions, and Economic Growth

6.1 Savings and Growth

6.2 State Pensions and Growth

6.3 Replacing State Pensions by a Means-Tested Safety Net

6.4 Conclusion

7   Investment, Pension Funds, and the Capital Market

7.1 Treatment of Investment in Growth Models

7.2 A Corporate Growth Model

7.3 Capital Markets and Private Pensions

7.4 Conclusion