EC 333 - Systems of the Welfare State in the EU: Origins, Present, and Future

In recent years, European welfare state systems have faced serious challenges: slowed economic growth, ageing societies, immigration, changing labor markets in the digital age, to name just a few. This crisis mode calls for an inspection and appraisal of the European model of the welfare state. Is it outdated and a hindrance in global competition? Or are unemployment insurance, poverty alleviation and a public health system more necessary than ever and can, on the contrary, serve as magic potion for economic prosperity? Among the various types and degrees of welfare states found among EU countries, is there a superior model? What are the particular challenges and opportunities involved in the design of welfare policies in an economic and monetary union in the 21st century?

This course will also investigate these questions using tools and economic analysis findings that encourage students in explorative learning. It will examine to what extent social policy is not only a matter of equity but also economic efficiency, and how countries can strike a good balance in addressing market failure while minimizing risk of government failure at the same time. The relative strengths and weaknesses of public versus private provision and of cash-benefits versus in-kind transfers are also explored. Given the contemporary societal and economic challenges, how does welfare policy need to be designed to be effective and sustainable? And how can empirical research findings guide policy makers in their attempt to address these issues?

In line with the general EU program structure, the course is designed to incorporate course-related trips in a way to prepare for and reflect on the specific course meetings after returning Freiburg. During the trips students will have an opportunity to observe the welfare systems in actual national settings and to meet local experts with whom they will discuss the class content in detail.

Throughout the course, comparison to US policies and experience will be drawn, and differences highlighted. As a key learning outcome, students will be able to judge the economic rationale for social policy and the welfare state in general, and to analyze the effects and side-effects of specific policy measures in various contemporary settings in detail.

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Introduction to Microeconomics and/or introduction to macroeconomics

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