The Impact of Globalization on the Institution of the Welfare State: Destruction or Modernization?

Abstract

The peculiarities of functioning of the social state institute in the conditions of globalization are investigated. Three scenarios of the impact of globalization on the welfare state are analyzed: negative, skeptical and positive. It is noted that the negative scenario links the link between globalization and the decline of welfare states; this link is defined as destructive because national states lose autonomy over social security policies. The skeptical scenario argues for the insignificant impact of economic globalization on the welfare state, as well as preserving the capacity of nation-states for social policy autonomy. The positive scenario has the least support in political science discourse; it assumes that globalization and the welfare state are compatible and mutually reinforcing. The article states that there is no stable scientific consensus on determining the content, boundaries, consequences of the impact of globalization on the welfare state. Proved working hypotheses: 1) economic globalization in its neo-liberal form, despite its obvious advantages, provokes excessive differentiation of income, migration flows, promotes technological unemployment, etc.; 2) the institute of the welfare state, within its current models, is not able to respond adequately to them, and therefore there is a prospect of updating national models of social policy. It is emphasized that globalization is affecting the institution of the welfare state not in a single scenario in different countries. It is suggested that the level of influence of globalization on the welfare state depends on the model of the welfare state; in particular, it is the strongest in the welfare state of the social-democratic model. It is emphasized that the extent of the impact of globalization on the welfare state is still dependent on the position of the nation-states themselves, first ‒ their willingness to reform national social security systems towards the introduction of systems of active social protection (stimulating human activity in the labor market, limiting passive spending, etc.).