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Declining participation in labor unions, the movement toward a service-based economy, and increased globalization have cast doubt on the extent to which welfare states can continue to stem inequality in market economies over the long-term. Does the new economy render existing models of social assistance obsolete? Do traditional welfare states hamper economic and employment growth, thereby worsening the plight of the poor? Lane Kenworthy offers a rigorous empirical analysis of these questions in Egalitarian Capitalism. The book examines sixteen industrialized countries in North America, Western Europe, and Scandinavia—each with different approaches to assisting the poor—to see how successful each has been in developing its economy and curbing inequality over the past twenty years. Kenworthy finds that inequality grew in almost all of these countries, from the most progressive to the least. Using simple but powerful statistical tests, he assesses the theory that inequality is necessary to improve economic growth and reduce poverty. He finds no necessary trade-off between equality and economic growth but discovers some evidence that high minimum wages dampen employment growth in private sector services. Kenworthy suggests that without greater private sector employment, public supports may be unable to adequately sustain living standards for the poor. An equitable growth strategy necessitates a balance of policy options: Creating jobs is aided by loose employment regulation, low payroll taxes, and, in some cases, lower real wages for workers at the bottom of the income spectrum. However, high employment is also facilitated by a system that "makes work pay" with earnings subsidies, workplace flexibilities, financial support for those who are between jobs or unable to work, and universal health and child care coverage. Kenworthy suggests that these strategies, though generally presented as mutually exclusive, could be effectively combined to create a robust, fair economy. Egalitarian Capitalism addresses fundamental questions of national policy with rigorous scholarship and a clarity that makes it accessible to any reader interested in the alleged trade-off between social equity and market efficiency. The book analyzes the viability of traditional welfare regimes and offers sustainable options that can promote egalitarian societies without hampering economic progress. A Volume in the American Sociological Association's Rose Series in Sociology

Why do rich countries flirt with fiscal disaster? Between the 1970s and the 2000s, during times of peace and prosperity, affluent countries—like Belgium, Greece, Italy, and Japan—accumulated so much debt that they became vulnerable and exposed themselves to the risk of default. In the past three decades, an extensive scholarly consensus emerged that these problems were created by fiscal indiscipline, the lack of sufficient concern for budgetary constraints from policy makers as they try to please voters. This approach formed the foundation for the fiscal surveillance system that attempted to bring borrowing in European countries under control via a set of fiscal rules. In the Red demonstrates that the problem of sustained, large-scale debt accumulation is an adjustment issue rather than a governance failure. Irrespective of whether the original impetus for borrowing arose from exogenous changes or irresponsible decision making, policy makers invariably initiate spending cuts and/or tax increases when debt grows at an alarming rate for several years in a row. Zsófia Barta argues that explaining why some countries accumulate substantial amounts of debt for decades hinges on understanding the conditions required to allow policy makers to successfully put into place painful adjustment measures.

Evidence from the United States suggests that technological change is a key factor in understanding both medical expenditure growth and recent dramatic improvements in the health of people with serious illnesses. Yet little international research has examined how the causes and consequences of technological change in health care differ worldwide. Seeking to illuminate these issues, this volume documents how use of high-technology treatments for heart attack changed in fifteen developed countries over the 1980s and 1990s. Drawn from the collaborative effort of seventeen research teams in fifteen countries, it provides a cross-country analysis of microdata that illuminates the relationships between public policies toward health care, technology, costs, and health outcomes.
The comparisons presented here confirm that the use of medical technology in treatment for heart attack is strongly related to incentives, and that technological change is an important cause of medical expenditure growth in all developed countries. Each participating research team reviewed the economic and regulatory incentives provided by their country's health system, and major changes in those incentives over the 1980s and 1990s, according to a commonly used framework. Such incentives include: the magnitude of out-of-pocket costs to patients, the generosity of reimbursement to physicians and hospitals, regulation of the use of new technologies or the supply of physicians, regulation of competition, and the structure of hospital ownership. Each team also reviewed how care for heart attacks has changed in their country over the past decade.
The book will be of enormous importance to health economists, medical researchers and epidemiologists, and policymakers.
Mark McClellan is Associate Professor of Economics and of Medicine and, by courtesy, of Health Research and Policy, Stanford University. He is a National Fellow, the Hoover Institution. Daniel P. Kessler is Associate Professor of Economics, Law, and Policy in the Graduate School of Business, Stanford University, and a Research Fellow, the Hoover Institution.