Economic Development More Important than Democracy in Promoting a Welfare State - Literature review Example

Economic Development More Important than Democracy in Promoting a Welfare Introduction Attaining welfare has been a highly debatable topic in the economic arena. In fact, even in distinguishing and defining what constitutes it exactly has also been subjected to question and disputes. With this, it is not surprising to know that economists, sociologists, and politicians alike are on split-views with regard to the processes that must be incorporated in order to fully develop a welfare state. On one side, proponents contend that economic development is more important than democracy in promoting a welfare state while proponents on the other side continue to lobby that democratic procedures are more powerful in achieving such condition for the public. Essentially, this paper provides various definitions of the “welfare state condition,” attempts to juxtapose the democratic view with the perspective that favors economic development, and presents a plausible explanation why economic development is more important than democracy. Also, this paper will enumerate several practices that contribute to economic development, thereby, increasing the chances of attaining a welfare state. Definition of Welfare State Over the years, there has been no strict and general definition of the welfare state. Some relate the term to power and industrialisation while others try to refer it as one of the capitalist contradictions. A classic definition of the term is the state’s “responsibility for securing some basic modicum of welfare for its citizens” (Pierson & Castles, 2006, p.160). Apart from this definition, Asa Briggs (as cited in Flora & Heidenheimer, 2009, p.29) also defined the welfare state as the condition characterised by an organised power that uses politics and administration to change the direction of market forces. This can be done in three ways: (1) through ensuring that individuals and families could receive a minimum income regardless of their properties’ market value, (2) by assisting families and individuals meet their social needs, thereby, reducing their sense of insecurity, and (3) ensuring that all citizens, regardless of social class and status, are given the highest standards of social services (as cited in Flora & Heidenheimer, 2009, p.29). The Democracy View vs. Economic Development After the in-depth discussion of the term welfare state, it is worthwhile to present the split views of paternalism and the democracy. Paternalism connotes economic development while democratic views favor a free market model. Throughout the years, there has been an existing clash between paternalism model followed in the 18th century and the emerging free market model that was especially advocated by Adam Smith. As a result, there were several insights generated to support its stand as well as to oppose each other’s perspectives. Paternalism, as defined by Abercrombie and Hill (as cited in Varano, 1999, p.26), is an economic institution that organises the productive unit and regulates the relationships between the owners of the means of production and their respective subordinates. Moreover, it is composed of different access to power and resources and an unequal distribution of goods and services. Oftentimes, paternalism emphasises elite control and privilege towards the subordinates. It also attempts to lessen the worst effects of industrial capitalism through combining traditional and community norms. Contrary to this view, some sociologists and economists alike such as Richard Sennett (as cited in Varano, 1999, p.27), contend that paternalism was intended to mask the hidden interest of the industrialists to enforce high level of production. He continues by citing that paternalism only connotes elite oversight and community welfare instead of advancing the morale of the workers (Varano, 1999, p.27). The free-market model also extremely contradicts to the paternalistic model since the latter was based on some statute laws, common laws, and customs while the former allows the exploration of the free workings of the market (Thompson, 1971, p.83). Theoretically, the paternalistic model protects the interests of the poorer classes and hopes to wash away the middleman, an extremely opposite view towards the free-market conditions wherein the middle men are given a significant attention in the course of selling and trading in the market (Thompson, 1971, p.119). Economic Development Better than Democracy Despite the arguments being presented to counter the paternalist view, there is no denying that it is better than democracy in terms of promoting a welfare state. Thompson, in The Moral Economy of the English Crowd in the Eighteenth Century, presented how the change in market factors--from feudalism to a free market--affected the behavior of the peasants. He emphasised that the rise of prices, attributed to such changing market conditions, urged the peasants to resort to and stick on the ways of paternalism (Thompson, 1971, pp.166-120). For them, this is the most effective way to perpetuate and sustain them during those hard times. Thompson also contends that changing market factors into a free-market one only prompted an increase of a backlash of riots in the 18th century England (Thompson, 1971, p.79). Moreover, a horrible scenario occurred when farmers were given the freedom to grow their crops. The democratic model is a less likely phenomenon than paternalist view since evidences point out that there is a need for outside forces in order to control the market. It also negatively affects the economy since it protects and advances the selfish interests of the crowd by making the prices stay as low as possible. Following the democratic model also brings out more chaos in the environment since more riots were produced in the community. More so, these riots were led by women and peasants who felt obliged to keep the grains at a reasonable level (Thompson, 1971, p.82). Remarkably though, these riots were not contributed by starvation or emaciation, rather, they are triggered by the anxiety felt by the peasants when they were faced with the threat of crop exportation and the continued rising of prices (Thompson, 1971, p.114). Later on, and much worse, peasants used riots to legitimise as soon as they feel disadvantaged or mistreated. Most notably, under democratic conditions, peasants are blinded with their own notion that they are protecting the old way of life as well as the whole of the community, or the so-called “moral economy.” With the aforementioned scenarios and behavioral tendencies of peasants, it has become more evident that their response clamours for better working conditions, more favorable economic prices, and a sustainable production or productivity levels. Also, it was evident that democratic procedures only worsen the problem by triggering more riots and limiting their notions on how to promote individual and community welfare. Thus, in an attempt to attain the welfare state, it is clearly articulated that economic development will serve the public--especially the peasants--better than any of the available democratic options. The following section provides some of the contemporary approaches to produce economic development. Activities towards Economic Development The state plays a big role during the largest economic transformations in history. As a matter of fact, its response to these economic stimuli will determine whether the state economy will be strengthened or weakened. There are several policies and interventions that could be done in order to promote economic development. Of these activities, two principal targets seem to prevail: the creation of jobs and reduction of inactivity, expenditure costs, and poverty, as well as the improvement of the policy making within the state. Also, the proponents of these interventions continue to seek the best evaluation material that would appropriately and most accurately measure the effectiveness of the programmes. Active Labour-Market Policies An example of intervention that is done to improve the economy is through active labour-market policies, defined as the work, training, and other programmes designed to aid the unemployed to finally secure jobs or else, increase their earnings (Robinson, 2000, p.14). During the 1990s, there was a surge of these policies since they were relatively simple and cost effective. The three main objectives for these policies are primarily geared towards reduction as follows: (1) reduction of unemployed and inactive citizens, (2) to reduce public expenditure or costs for “welfare dependency,” and (3) reduction of income poverty. Notably, these objectives may come in conflict with one another. Normally, interventions may vary depending on which among the three objectives is prioritised (Robinson, 2000, p.14). In fact, different governments are identified merely through examining their distinct objectives. For instance, the American states primarily aim to lessen the ‘welfare rolls’, European countries are geared towards income equality, and Blair government seeks to increase employment rates (Robinson, 2000, p.14). Moreover, active labour-market policies include programmes that enhance labour-market efficiency and to promote equal work opportunities. With this, three specific measures were taken (Robinson, 2000, p.17). First is to lessen mismatch and improve job search, which is done through notifying job-seekers for vacancies, providing counsel to them as they look for work, improving the quality of their job search, to place job-seekers in helpful employment programmes, and to update them of their eligibility to benefits (p. 17). The second measure is to increase the skills of job-seekers through dealing with skill shortages and actively responding to signals of low occupational capabilities (p. 17). Third is to directly subsidise the employment for specific target groups. This could be done through assigning job-seekers to temporary work programmes, low-skilled jobs involving environmental work, social, or community services, as well as using incentives, e.g., recruitment subsidies (p. 17). Most importantly, these measures could be very beneficial especially to the marginalized sectors of the community--long-term unemployed, disabled, and the young people (p. 17). Furthermore, there is a rising need to evaluate these active labour-market programmes--based primarily on employment and earnings (Robinson, 2000, p.19). This kind of assessment must also be patterned through a model that takes into account economic cycle, deadweight, substitution, and displacement controls. Basically, the evaluation of the three specific measures above could be done by using two groups, the experimental and control groups. By doing this, researchers are able to determine whether there occurs an improvement in the course of employing such measures. Evidence-Based Policies Meanwhile, there is another approach that is emerging today--evidence-based policy making--emphasising the role of social scientists in the process of generating policies. According to Blunkett (as cited in Young, et al., 2002, p.215), this is done in order to pinpoint which specific policy initiatives work or are most likely to be effective. Moreover, this kind of research could offer a deeper understanding of conditions under several interventions. It provides policy-makers in-depth understanding, illumination, and explanation first before acting compulsively on the policy solutions (Young, et al., 2002, pp.217-218). A concrete example of evidence-based practices is that in the field of medicine, which was considered one of the utmost aspirations of the UK National Health Service (Harrison, n.d., p.15). Evidence-based medicine was intended to achieve the maximum and optimal state of the physical and mental health of a nation. In order to attain this, the decisions on the delivery and processes were evaluated based on the systematic assessment of actual health outcomes. Clinical and practice and cost-effective measures were taken to achieve this end (Besley & Snell, 2009, p.1). Essentially, evidence-based policies are intended to improve the socioeconomic conditions of the state. If evidences in policy and practice are used, methods will be improved. As this happens, more and more people will gain access to the so-called welfare state. Eventually, this will develop and improve the condition of the whole populace. Conclusion Throughout this paper, evidence shows that advancing to a welfare state has been one of the most pressing issues today. As a result, several approaches were introduced and debated about so as to achieve optimum welfare for the public. In the end, economic development prevailed to be the top priority--even surpassing democratic policies. After all, it boils down to providing the basic needs of the people while ensuring that they are able to sustain their economic condition. Most importantly, attempts to counter or reduce socio-economic problems, like poverty, would be more meaningful if methods and policies would be validated and evaluated based on their scientific effectiveness. This is the role, which active labour-market policies and evidence-based policies take in. Both methods were improvised to better assess the needs and wants of the society as a whole, thereby promoting economic development and eventually turning the state into a welfare state. References Besley, J., & Snell, T., 2009. What is evidence-based medicine? [Online] Hayward Medical Communications. Available at: http://www.medicine.ox.ac.uk/bandolier/painres/download/whatis/ebm.pdf [Accessed 19 January 2012]. Flora, P. & Heidenheimer, A.J. eds., 2009. The development of welfare states in Europe and America. New Jersey: Little, Brown, and Company. Harrison, S., n.d. The politics of evidence-based medicine in the United Kingdom. Policy & Politics, 26(1), pp.15-31. Pierson, C. & Castles, F., 2006. The welfare state. 2nd ed. Cambridge: Polity Press. Robinson, P., 2000. Active labour-market policies: A case of evidence-based policy-making? Oxford Review of Economic Policy, 16(1), 13-26. Thompson, E.P., 1971. The moral economy of the english crowd in the eighteenth century. Past & Present, 50, 76-136. Varano, C., 1999. Forced choices: class, community, and worker ownership. New York: State University of New York Press. Young, K., Ashby, D., Boaz, A., & Grayson, L., 2002. Social science and the evidence-based policy movement. Social Policy & Society, 1(3), pp.215-224. Read More