Fellows Program on Peace, Governance, and Development in East Asia

 

Abstract
How does economic globalization influence individuals’ welfare attitudes? Much of the focus in the literature has been on identifying the losers under globalization, and exploring whether and to what extent they demand compensation in the form of government redistribution. We argue that economic globalization shapes welfare attitudes in a more multi-faceted way. We propose four types of citizens based on self-perceived economic consequences of globalization to themselves and to the nation: collective winner, lone winner, lone loser, and collective loser. We then theorize how each type relates to three distinctive motives behind welfare demand: insurance-seeking, equality-seeking as well as compensation-seeking. We examine our theoretical expectations with the case of South Korea, where we survey social spending preferences under different hypothetical scenarios of fiscal constraint and recipient targeting. We find a surprisingly low level of support for social spending among lone losers (i.e., those who believe globalization is bad for themselves but not for Koreans in general) across all scenarios, thus evidence against both compensation-seeking and equality-seeking mechanisms. The support level is much higher among the lone winners, those who believe globalization is not bad for them yet hurts Koreans in general. The lone winners are more supportive than any other group when it comes to the universal flat-rate transfer. The findings together validate the insurance-seeking mechanism. Our findings have implications for the direction of welfare state development under globalization.

 

Quotes from the Paper
“We argue that economic globalization shapes welfare attitudes in a more multi-faceted way and propose four types of citizens who have distinct perceptions about the impact of globalization: those who perceive that globalization benefits both themselves and others in the society (Collective winner); those who perceive that globalization benefits themselves but hurts others (Lone winners); those who perceive that globalization hurts themselves but benefits others (Lone loser); and those who perceive that globalization hurts both themselves and others (Collective loser)”

 

“...... we find a surprisingly low level of support for social spending among lone losers(i.e., those who believe globalization hurts themselves but not others) across all scenarios, which is, we consider, evidence against both compensation-seeking and equality-seeking mechanisms. The support level is much higher among the lone winners, those who believe globalization is not bad for themselves yet hurts others. The lone winners are more supportive than any other group of citizens when it comes to spending on the universal flat-rate transfer. We interpret that the findings together lend the most consistent support for the insurance-seeking mechanism: those who see potential risks of economic globalization support welfare spending as an attempt to prevent the harmful consequences ex ante.”

 

“We believe our study has important theoretical and empirical implications for the welfare state development under globalization. But we also acknowledge that our study in the context of South Korea may not be readily generalizable to many other settings. The limited social distance among citizens, rel¬atively low inequality, and relatively small and immature social policy institutions might distinguish the country from other emerging economies (e.g., those in Latin America with more long-standing welfare programs) as well as from the mature, Western welfare states. We thus need further comparable research with similar surveys to assess the generalizability of our study. Still, we believe our study provides a foundation for such future com-parative research..”

 

“......our study reveals that a sizable minority of citizens classified as lone winners have the potential for driving the expansion of the welfare state, especially of universal preventive policies of the welfare state....... If lone winners were to drive the welfare state expansion under globalization, what are the ramifications for the protection of the poorest and disadvantaged? As the redistributive effect of universal flat benefits (the form of spending preferred by lone winners) depends on the tax system, answering this question would require further research on tax preferences of citizens. In South Korea where both tax revenue and tax progressivity remain low, introducing new universal flat benefits under the current system has limited progressive redistribution potential. The demographic composition of lone winners also makes us less sanguine”

 

“Once globalization broadens the support base for the welfare state, the type of policy frames employed by political leaders and policy entrepreneurs might play a critical role in determining the direction of the welfare state expansion. Framing a new social spending as an essential future-oriented policy (i.e., insurance for uncertainties) might be more effective in tapping into the lone winners’ willingness to support than framing the spending as pro-poor or egalitarian. Such a framing could allow the government to raise more social spending revenue, which in turn, help the government pursue compensatory or egalitarian goals via increasingly generous, universalistic benefits. The “Robin Hood function” of the welfare state can be hidden but need not be discarded.”

 

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Author
Sijeong Lim is assistant professor at the Department of Political Science and part of the Political Economy and Transnational Governance (PETGOV) programme group. Her research interests lie at the intersection of international political economy and public policy. She seeks to understand how various dimensions of economic globalization influence public policy outputs and outcomes in industrializing countries, especially in the areas of social and environmental policies. She received her doctoral degree in Political Science from University of Washington, Seattle. Before coming to Amsterdam, she worked as a post-doctoral researcher at Stockholm University in Sweden.

 

Seiki Tanaka is assistant professor of political science, and joined the department in September 2015. Previously, he taught at Syracuse University, and was a visiting scholar at Yale University and a post-doc at Princeton University. His research interests include the political economy of poverty and inequality, discrimination, redistribution, and conflicts.