2016

The Future of Welfare Services: How Worried Should We Be about Baumol, Wagner and Ageing?

Reprint No. 2016:17

Author(s): Andreas BerghYear: 2016 Title: Nordic Economic Policy Review Volume (No.): 2016 (1) Pages: 197–217
Online article (restrictions may apply)
Preliminary version

The Future of Welfare Services: How Worried Should We Be about Baumol, Wagner and Ageing? Andreas Bergh


Welfare services are an important part of the Nordic welfare states both financially and for welfare state redistribution. Baumol’s cost disease, Wagner’s law, and population ageing are often said to bring challenges for the future provision of welfare services. While none of the three poses an immediate threat against the financial sustainability of the welfare state, they have important implications for distribution and for the political support for the welfare state. The combination demographic change, a higher relative price of welfare services and increasing demand for welfare services may force politicians to make a difficult choice between increasing taxes, allowing people to top up publicly financed services with additional private financing, or risk eroding support for the welfare state.


Reference:
Bergh, Andreas (2016), "The Future of Welfare Services: How Worried Should We Be about Baumol, Wagner and Ageing?". Nordic Economic Policy Review 2016(1), 197–217.

Andreas Bergh

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Interdisciplinary European Studies

The European Union and the Return of the Nation State

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This book explores the complex and ever-changing relationship between the European Union and its member states. The recent surge in tension in this relationship has been prompted by the actions of some member state governments as they question fundamental EU values and principles and refuse to implement common decisions seemingly on the basis of narrowly defined national interests.

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