@incollection{Orszag1998Expanding,
abstract = {The proposal involves the establishment of ?welfare accounts? for every person in
a country. There are to be four accounts: a retirement account (covering pensions), an
unemployment account (covering unemployment support), a human capital account
(covering education and training), and a health account (covering insurance against
sickness and disability). Instead of the current welfare state systems - where welfare
services are financed predominantly out of general taxes - people would make ongoing,
mandatory contributions to each of these welfare accounts. The balances in these accounts
would cover people?s major welfare needs. The government is to set mandatory minimum
contribution rates and maximum withdrawal rates from the accounts. The government is to
have two budgetary systems: one in which non-welfare expenditures are financed through
the existing array of taxes, and another system in which the public-sector expenditures on
welfare services are financed through payments from people?s welfare accounts. The
government would be able to redistribute income across people?s welfare accounts, but
these redistributions would be constrained to be of the balanced-budget variety: total
(economy-wide) taxes on each of the welfare accounts would be equal to total transfers into
each of accounts. The public and private sectors would provide welfare services on an equal
footing, setting prices for these services and competing with one another for the custom of
the welfare account holders. We argue that moving from the current welfare state systems to
a welfare account system may be expected to play a substantial role in reducing
unemployment, encouraging labour force participation, promoting skills, reducing governments? budgetary pressures, cushioning people against economic risks, ensuring
efficient provision of health and education services, providing social safety nets and
redistributing incomes more efficiently.},
address = {Luxembourg},
author = {Jonathan Michael Orszag and Dennis J. Snower},
booktitle = {The welfare state in Europe},
copyright = {http://www.econstor.eu/dspace/Nutzungsbedingungen},
editor = {Europ\"{a}ische Kommission / Generaldirektion Wirtschaft und Finanzen},
isbn = {92-828-2118-8},
keywords = {E64; E61; E62; H54; H61; H52; H42; H23; I11; H24; I38; J68; I22; H51; H53; H11; I28; H41; 330; Welfare state , redistribution , social insurance , unemployment , health , education and training , pensions , sickness and disability ,; Sozialstaat; Reform; Einkommensumverteilung; Theorie},
language = {eng},
number = {1997,4},
pages = {101-117},
publisher = {Off. for Off. Publ. of the Europ. Communities},
series = {European economy $ Reports and studies},
title = {Expanding the welfare system : a proposal for reform},
url = {http://hdl.handle.net/10419/2093},
year = {1998}
}
