My Research
Decentralization and the welfare state
I examine how welfare state reforms, which transfer authority from the central government to subnational governments, affect the ability of the welfare state to guarantee uniform social rights across the national territory. In contrast to the methodological nationalism of recent research on decentralization and the welfare state, my project directs attention to subnational governments. I ask: What are the regional context factors that shape regional governments’ social policy generosity? Does the effect of regional context change depending on the macro-institutional structure, particularly the level and type of decentralization? And thirdly, does decentralization increase within country territorial disparities in social policy generosity, and if so what institutions can counteract the centrifugal effects of decentralization?
A novel dataset I collected specifically for this research project allows me to examine the effect of regional context on social policy generosity over time and across different national contexts. The dataset combines data on regional spending in three areas of social policy – social welfare, education and healthcare - in more then 250 regions in 15 OECD countries over 20 years (1990-2010). I can therefore explore how different macro-level institutions moderate the effect of regional context factors. My findings suggest that regional GDP per capita and the ideological orientation of a regional government are the most important determinants of regional social policy generosity. I further show that the effect of both factors is stronger in more decentralized national contexts. Interestingly the effect of a region’s demographic composition does not depend on the national institutional structure. It affects regional social spending regardless of how decentralized the context. Since decentralization amplifies the effect of diverse levels of regional affluence and political orientation, social policies tend to be more heterogeneous the more decentralized a country. By transferring social policy authority to subnational governments, the central government therefore relinquishes part of its equalizing influence.
This finding contradicts previous public choice research, which argues that decentralization induces a competition for lower taxes between regional units that results in a convergence on similar and low level of regional social spending. My findings cast doubt on this convergence hypothesis and suggest that higher levels of decentralization lead to more dramatic levels of within country heterogeneity in social spending, which can undermine a welfare state’s ability to provide uniform social rights across its territory. In a second step I therefore examine how other macro level institutions - aside from the level and type of decentralization – influence within country heterogeneity in social policy generosity. In particular, I explore the effect of fiscal equalization mechanisms, cross-regional policy coordination and centralized political parties. I find that institutions, which foster policy coordination, have by far the strongest decreasing effect on within country disparities and may counteract the centrifugal effects of decentralization. My quantitative analysis is complemented with a qualitative chapter that examines the institutional structure of decentralized countries in a more in-depth manner. I develop a typology of decentralized welfare states that is based on different institutional combinations and the level of heterogeneity they generate. I further delve into the historical origins of these different institutional structures and examines why some decentralized countries have developed mechanisms for counterbalancing the effects of decentralization while others have not.
I examine how welfare state reforms, which transfer authority from the central government to subnational governments, affect the ability of the welfare state to guarantee uniform social rights across the national territory. In contrast to the methodological nationalism of recent research on decentralization and the welfare state, my project directs attention to subnational governments. I ask: What are the regional context factors that shape regional governments’ social policy generosity? Does the effect of regional context change depending on the macro-institutional structure, particularly the level and type of decentralization? And thirdly, does decentralization increase within country territorial disparities in social policy generosity, and if so what institutions can counteract the centrifugal effects of decentralization?
A novel dataset I collected specifically for this research project allows me to examine the effect of regional context on social policy generosity over time and across different national contexts. The dataset combines data on regional spending in three areas of social policy – social welfare, education and healthcare - in more then 250 regions in 15 OECD countries over 20 years (1990-2010). I can therefore explore how different macro-level institutions moderate the effect of regional context factors. My findings suggest that regional GDP per capita and the ideological orientation of a regional government are the most important determinants of regional social policy generosity. I further show that the effect of both factors is stronger in more decentralized national contexts. Interestingly the effect of a region’s demographic composition does not depend on the national institutional structure. It affects regional social spending regardless of how decentralized the context. Since decentralization amplifies the effect of diverse levels of regional affluence and political orientation, social policies tend to be more heterogeneous the more decentralized a country. By transferring social policy authority to subnational governments, the central government therefore relinquishes part of its equalizing influence.
This finding contradicts previous public choice research, which argues that decentralization induces a competition for lower taxes between regional units that results in a convergence on similar and low level of regional social spending. My findings cast doubt on this convergence hypothesis and suggest that higher levels of decentralization lead to more dramatic levels of within country heterogeneity in social spending, which can undermine a welfare state’s ability to provide uniform social rights across its territory. In a second step I therefore examine how other macro level institutions - aside from the level and type of decentralization – influence within country heterogeneity in social policy generosity. In particular, I explore the effect of fiscal equalization mechanisms, cross-regional policy coordination and centralized political parties. I find that institutions, which foster policy coordination, have by far the strongest decreasing effect on within country disparities and may counteract the centrifugal effects of decentralization. My quantitative analysis is complemented with a qualitative chapter that examines the institutional structure of decentralized countries in a more in-depth manner. I develop a typology of decentralized welfare states that is based on different institutional combinations and the level of heterogeneity they generate. I further delve into the historical origins of these different institutional structures and examines why some decentralized countries have developed mechanisms for counterbalancing the effects of decentralization while others have not.
Gender inequality, social policies and labor markets
I have a broader interest in the relationship between social policy, labor markets and gender inequality. Two strands of research offer explanations for gender inequality in labor force participation and the division of household labor. Scholars in the Varieties of Capitalism (VOC) tradition tend to focus on labor market institutions as the main driver of gender inequality, whereas welfare state scholars highlight the role of social policies. Although both approaches are complimentary in other contexts, they yield different predictions with regard to gender relevant outcomes (Rubery 2009). In a paper currently under review I revisit the VOC literature's main claim that labor markets privileging specific rather than general skills are worse for women’s employment, since specific skills deteriorate swiftly during women’s absences from the labour market. The empirical analysis of multiple waves of the ISSP survey on gender relations yields little support for this claim. In fact, evidence in support for the VOC explanation disappears when controlling for social policies, which suggests that a gendered welfare state approach offers a more compelling explanatory framework for gender relevant outcomes. This paper therefore substantiates earlier critiques of VOC . I also took part in updating the Comparative Welfare States Dataset (2014), a dataset compiled by David Brady, Evelyne Huber, and John D. Stephens that provides indicators on social expenditures, labor market institutions, demographics and political institutions.
I have a broader interest in the relationship between social policy, labor markets and gender inequality. Two strands of research offer explanations for gender inequality in labor force participation and the division of household labor. Scholars in the Varieties of Capitalism (VOC) tradition tend to focus on labor market institutions as the main driver of gender inequality, whereas welfare state scholars highlight the role of social policies. Although both approaches are complimentary in other contexts, they yield different predictions with regard to gender relevant outcomes (Rubery 2009). In a paper currently under review I revisit the VOC literature's main claim that labor markets privileging specific rather than general skills are worse for women’s employment, since specific skills deteriorate swiftly during women’s absences from the labour market. The empirical analysis of multiple waves of the ISSP survey on gender relations yields little support for this claim. In fact, evidence in support for the VOC explanation disappears when controlling for social policies, which suggests that a gendered welfare state approach offers a more compelling explanatory framework for gender relevant outcomes. This paper therefore substantiates earlier critiques of VOC . I also took part in updating the Comparative Welfare States Dataset (2014), a dataset compiled by David Brady, Evelyne Huber, and John D. Stephens that provides indicators on social expenditures, labor market institutions, demographics and political institutions.
Fiscal decentralization, subnational debt and bailouts
I am currently working on a line of research that focuses on the causes of subnational debt. The issue of subnational debt has received a growing attention by both researchers and policy makers in the light of the recent fiscal and economic crisis, which brought a number of subnational governments to the brink of default. The existing fiscal decentralization literature considers the accumulation of subnational debt to be the result of lax borrowing regulations and subnational governments' fiscal dependence on the central government. The latter raises bailout expectations and creates a moral hazard problem. Due to the sparsity of cross-national data on subnational debt, most of the existing empirical work either looks at single countries or at national averages of subnational debt, which blurs the vast variation in debt levels that exists within countries. I am therefore working on compiling a dataset that provides data at the subnational level for a larger number of OECD countries. Based on this dataset, I will analyze whether a moral hazard dynamic can account for much of the variation in subnational debt, while also controlling for alternative explanations that center more on regional context based factors.
I am currently working on a line of research that focuses on the causes of subnational debt. The issue of subnational debt has received a growing attention by both researchers and policy makers in the light of the recent fiscal and economic crisis, which brought a number of subnational governments to the brink of default. The existing fiscal decentralization literature considers the accumulation of subnational debt to be the result of lax borrowing regulations and subnational governments' fiscal dependence on the central government. The latter raises bailout expectations and creates a moral hazard problem. Due to the sparsity of cross-national data on subnational debt, most of the existing empirical work either looks at single countries or at national averages of subnational debt, which blurs the vast variation in debt levels that exists within countries. I am therefore working on compiling a dataset that provides data at the subnational level for a larger number of OECD countries. Based on this dataset, I will analyze whether a moral hazard dynamic can account for much of the variation in subnational debt, while also controlling for alternative explanations that center more on regional context based factors.
