The Economics of Social Protection

The Economics of Social Protection

Lars Söderström

This book focuses on arrangements for redistributing consumption opportunities over the life cycle and for providing compensation for income losses or large expenditures due to reasons such as illness and unemployment. After extensive coverage of the nature of inequalities in income and wealth in a market economy, and various notions of social justice, the author discusses public and private transfers in cash or in kind related to old age, childhood, illness and the like. Importantly, the book takes into account both equity and efficiency aspects.

Preface

Lars Söderström

Subjects: economics and finance, public finance, public sector economics, welfare economics, social policy and sociology, economics of social policy

Extract

On and off, I have been analysing various aspects of the welfare state for almost forty years. It started with an invitation to participate in a government inquiry on remaining poverty in the Swedish welfare state. Who was poor, and why? My task was to find suitable measures of an individual’s or family’s income and wealth, and to collect relevant statistical data. Some of this work can still be traced in tables on the distribution of income presented by Statistics Sweden. I then returned to the university to teach public finance and social insurance, and to form a seminar group to discuss various aspects of the economics of human capital, in particular health economics. Particularly exciting for me in the 1970s was participating in the workshop run by Gary Becker while I was a visiting scholar at the University of Chicago. Back in Lund, I became engaged in a campaign to change the Swedish tax system. Inspired by Knut Wicksell and Erik Lindahl, we formed a group in Lund to argue in favour of the view that taxes should be seen in relation to the kind of expenditures they were supposed to finance. Instead of discussing whether taxes, in general, should be direct or indirect, progressive or flat, and so on, we tried to find out the best way to finance health care, public pensions, income security, and so on. Much of this book is based on the discussions we had at that time. It is fair to say, I...