Industrial Capitalism and the Welfare of the State: The Role of Employers in the Comparative Development of Welfare States. A Review of Recent Research

Recent debates on the future of social benefits in the market economy have focussed attention on the origins of state services and the conditions which encouraged the growth of public welfare in modern society. The emphasis in the recent writing has been upon the political conditions for the evolution of citizenship rather than on economic and industrialisation models of welfare expenditure. At the same time there have been various attempts to adapt and refine the rational choice analysis of public goods to explain individual support for collective services. Each of these approaches has been developed with a strong interest in the historical and comparative analysis of welfare provision. This essay reviews recent research and the definitions of economic and political power which are employed. Many writers stress the continuities of traditional institutions at the expense of recurring economic and political conflict which defined the practical boundaries of citizenship. An alternative view of capitalist prerogatives is outlined. Taking the particular example of industrial capitalism and social insurance in Britain, it is argued that the social policies of the state formed part of a wider political settlement at key moments of development. In this process we can trace the significance of discursive struggles as well as economic structures and state initiatives. Such an approach reveals the complexity of political processes and the limits of comparative studies which focus primarily on economic or state structures.