How does international integration affect the welfare state? Does it call for a leaner welfare state to reap the benefits of integraiton or is it necessary to expand the welfare state to offset some negative consequences of international integration? This paper addresses these issues in a fully...

Recent developments in macroeconomics are reviewed, and it is argued that a better understanding of the role of market failures and institutions is a major achievement. The insights in when and how policy intervention may be called for have thus been improved. However, the progress does not...

This paper discusses how international integration affects the need and scope for welfare state activities. The first part reviews the main mechanisms, which have been considered in the literature, namely, tax base mobility, risk and race to the bottom effects in welfare policies. The second...

Unemployment is at a low and stable level in Denmark. This achievement is often attributed to the so-called flexicurity model combining flexible hiring and firing rules for employers with income security for employees. Whatever virtues this model may have, a low and stable unemployment rate is...

Workfare policies are often introduced in labour market policies to improve the trade-off between incentives and insurance as an alternative to benefit reductions. Most of the debate on such policies has focussed on the direct effect of those participating in the scheme, and in particular the...

Increasing longevity causes an upward trend in the dependency ratio in many countries. This raises concerns about the financial sustainability of social security schemes, and reform proposals and initiatives abound. It is shown that a fundamental policy choice inevitably arises since a given...

The role of real and nominal propagation mechanisms in generating persistent real effects of nominal shocks is analysed analytically in a fully specified intertemporal general equilibrium model. While neither a real propagation mechanism (capital acccumulation) with one-period nominal contracts...

It is vividly debated how the ongoing process of European integration will affect the need and scope for welfare state activities. To some this process signals that welfare state activities have to be rolled back, while others stress that international integration may increase the need for...