In Esping-Andersen's influential work decommodification appears as the central characteristic of the welfare state, and efforts to decommodify labour are posited to be the main goal of social democracy. Since decommodification is defined as exit from the labour market with little or no loss of income, social democrats' emphasis on decommodification clashes with another purported goal of social democracy, high labour force participation. Drawing on research demonstrating the divergent employment effects of various decommodifying social policies, we resolve the existing paradox by showing that social democratic parties are supportive of decommodifying social policies insofar as these policies do not reduce aggregate levels of employment. Pooled time series analysis of employment-impeding policies (long-term unemployment replacement rate, social security and payroll taxes, and employment protection) suggests that they are associated with Christian democracy rather than social democracy. Instead, we find that social democracy is a key determinant of employment-friendly policies, such as active labour market spending and short-term unemployment replacement rate. Given the radically divergent employment effects of different types of decommodifying social policies and the importance of employment-friendly policies for the viability of generous welfare states, our analysis further underlines the future viability of the social democratic model.
Achen, C. (2000) `Why Lagged Dependent Variables Can Suppress the Explanatory Power of Other Independent Variables', paper delivered at the Annual Meeting of Political Methodology Section of the American Political Science Association, University of California (July), Los Angeles, CA.
2.
Beck, N. and Katz, J.N. (1995) `What to Do (and Not to Do with Time Series-cross Sectional Data', American Political Science Review89: 634—47.
3.
Beck, N. and Katz, J.N. (1996) `Nuisance Versus Substance: Specifying and Estimating Time Series-cross Sectional Models', PoliticalAnalysis6: 1—36.
4.
Beck, N. and Katz, J.N. (2004) `Time-series Cross-section Issues: Dynamics 2004 ', paper delivered at the annual meeting of the Society for Political Methodology, Stanford University , Palo Alto, CA.
5.
Bradley, D. and Stephens, J.D. (2007) `Employment Performance in OECD Countries: a Test of Neo-liberal and Institutionalist Hypotheses ', Comparative Political Studies40 (12): 1—25.
6.
Bradley, D., Huber, E., Moller, S., Nielsen, F. and Stephens, J.D. (2003) `Distribution and Redistribution in Post-industrial Democracies', World Politics55 (2): 193—228.
7.
DiPrete, T.A. (2002) `Life Course Risks, Mobility Regimes, and Mobility Consequences: a Comparison of Sweden, Germany, and the United States', American Journal of Sociology108: 267—309.
8.
DiPrete, T.A. and McManus, P.A. (2000) `Family Change, Employment Transitions, and the Welfare State: Household Income Dynamics in the United States and West Germany ', American Sociological Review65: 343—70.
9.
Esping-Andersen, G. (1985) Politics Against Markets: the Social Democratic Road to Power. Princeton, NJ: Princeton University Press.
10.
Esping-Andersen, G. (1990) The Three Worlds of Welfare Capitalism. New Jersey, NJ: Princeton University Press.
11.
Esping-Andersen, G. (2000) `Multi-dimensional Decommodification: a Reply to Graham Room', Policy & Politics28 (3): 353—9.
12.
Esping-Andersen, G. and Regini, M. (eds) (2000) Why Deregulate Labour Markets?New York, NY: Oxford University Press.
13.
Estevez-Abe, M., Iversen, T. and Soskice, D. (2001) `Social Protection and the Formation of Skills: a Reinterpretation of the Welfare State', in P. A. Hall and D. Soskice (eds) Varieties of Capitalism: the Institutional Foundations of Comparative Advantage , pp. 145—83. Oxford: Oxford University Press.
14.
Gangl, M. (2004) `Welfare States and the Scar Effects of Unemployment: a Comparative Analysis of the United States and West Germany', American Journal of Sociology109 (6): 1319—64.
15.
Hernes, H.M. (1987) Welfare State and Woman Power. Essays in State Feminism. Oslo: Norwegian University Press.
16.
Hibbs, D. (1977) `Political Parties and Macroeconomic Policy', American Political Science Review71: 1467—87.
17.
Hicks, A. (1994) `Introduction to Pooling', in T. Janowski and A. Hicks (eds) The Comparative Political Economy of the Welfare State. New York, NY: Cambridge University Press.
18.
Hicks, A. (1999) Social Democracy and Welfare Capitalism: a Century of Income Security Policies. Ithaca, NY: Cornell University Press.
19.
Huber, E. and Stephens, J.D. (2000) `Partisan Governance, Women's Employment, and the Social Democratic Service State', American Sociological Review45: 323—42.
20.
Huber, E. and Stephens, J.D. (2001) Development and Crisis of the Welfare State: Parties and Policies in Global Markets. Chicago, IL: University of Chicago Press.
21.
Huber, E. and Stephens, J.D. (2006) `Combating Old and New Social Risks', in K. Armingeon and G. Bonoli (eds) The Politics of Post-industrial Welfare States: Adapting Post-war Social Policies to New Social Risks, pp. 143—68. London: Routledge.
22.
Huber, E., Nielsen F., Pribble, J. and Stephens, J.D. (2006) `Politics and Inequality in Latin America and the Caribbean', American Sociological Review71(6): 943—63.
23.
Huber, E., Ragin, C. and Stephens, J.D. (1993) `Social Democracy, Christian Democracy, Constitutional Structure, and the Welfare State', American Journal of Sociology99: 711—49.
24.
Huber, E., Ragin, C., Stephens, J.D., Brady, D. and Beckfield, J. (2004a) `Comparative Welfare States Data Set', Northwestern University, University of North Carolina , Duke University and Indiana University.
25.
Huber, E., Stephens, J.D., Bradley, D., Moller, S. and Nielsen, F. (2004b) `The Welfare State and Gender Equality', Luxembourg Income Study Working Paper No. 279.
26.
Huo, J. (2006) `Third Way Reforms: a Comparative Study of Social Democratic Welfare State Reforms after the Golden Age', PhD dissertation, University of North Carolina, Chapel Hill.
27.
Iversen, T. (2005) Capitalism, Democracy and Welfare. New York: Cambridge University Press.
28.
Korpi, W. (1983) The Democratic Class Struggle. London: Routledge and Kegan Paul.
29.
Kvist, J. (2001) `Activating Welfare States: How Social Policies Can Promote Employment', in J. Clasen (ed.) What Future for Social Security?The Hague : Kluwer Law International.
30.
Marx, K. (1954—56) Capital. London: Lawrence and Wishart.
31.
Moller, S., Bradley, D., Huber, E., Nielsen, F. and Stephens, J.D. (2003) `Determinants of Relative Poverty in Advanced Capitalist Democracies', American Sociological Review68 (1): 1—30.
32.
O'Connor, J.S., Orloff, A.S. and Shaver, S. (1999) States, Markets, Families: Gender, Liberalism and Social Policy in Australia, Canada, Great Britain and the United States. Cambridge: Cambridge University Press.
33.
Oecd (2004) Employment Outlook 2004. Paris: OECD.
34.
Orloff, A.S. (1993) `Gender and the Social Rights of Citizenship: the Comparative Analysis of Gender Relations and the Welfare State', American Sociological Review58 (3): 303—28.
35.
Plümper, T., Troeger, V.E. and Manow, P. (2005) `Panel Data Analysis in Comparative Politics: Linking Method to Theory', European Journal of Political Research44: 327—54.
36.
Polanyi, K. (1944) The Great Transformation. New York, NY: Rinehart.
37.
Rogers, W.H. (1993) `sg17: Regression Standard Errors in Clustered Samples', Stata Technical Bulletin13: 19—23. (Reprinted in Stata Technical Bulletin Reprints3: 88—94.)
38.
Room, G. (2000) `Commodification and Decommodification: a Developmental Critique', Policy &Politics28 (3): 331—51.
39.
Rothstein, B. (2006) `Valet en triumf för socialdemokraterna' (The election was a triumph for the Social Democrats), Dagen Nyheter (20 Sep.). Available at: [http://www.dn.se/DNet/jsp/polopoly.jsp?a=574004 ].
40.
Rueschemeyer, D., Stephens, E.H. and Stephens, J.D. (1992) Capitalist Development and Democracy. Chicago, IL: University of Chicago Press.
41.
Schwartz, H.M. (2001) `The Danish “Miracle”. Luck, Pluck or Stuck?', Comparative Political Studies34 (2): 131—55.
42.
Scruggs, L. (2004) `Unemployment Replacement Rate Data Set', Welfare State Entitlements Data Set: a Comparative Institutional Analysis of Eighteen Welfare States, Version 1.0 Available at: [ http://sp.uconn.edu/~scruggs/wp.htm].
43.
Stephens, J.D. (1979) The Transition from Capitalism to Socialism. London: Macmillan.
44.
Stetson, D. M. and Mazur, A. G. (eds) (1995) Comparative State Feminism . Thousand Oaks, CA: Sage.
45.
Swank, D. (2002) Global Capital, Political Institutions, and Policy Change in Developed Welfare States. Cambridge/ New York: Cambridge University Press.
