The Economics of Welfare Policies

The Economics of Welfare Policies

The Economics of Welfare Policies

The Economics of Welfare Policies

Excerpt

Throughout most of recorded history, society has assumed some degree of responsibility for the relief of poverty, but, whereas in earlier periods private organizations played the leading role in providing benefits for the poor, the modern tendency has been for governments to assume an increasing share of the responsibility. The factors accounting for this trend are complex. Underlying the whole development is the process of industrialization, with its manifold social and economic consequences. However, increasing governmental intervention in the welfare field began long before the industrial revolution and is manifest today in countries that have scarcely been touched by industrialization.

Historically, we may distinguish three stages in the development of public welfare programs. The breakdown of feudalism and, somewhat later, the Reformation led to the adoption of public systems of poor relief, largely at the local level, to replace, at least in part, the welfare functions carried out by church, manor, and guild in medieval society (62, 81). However, although the transition from feudalism to the market-oriented economies of the sixteenth and seventeenth centuries was accompanied by an increase in economic insecurity for the working classes, prevailing social views regarded poverty as largely a result of individual shiftlessness-except in the case of the aged, the disabled, and needy children, who were classified as impotent or dependent. Standards of poor relief were harshly restrictive and meager, lest able-bodied persons be encouraged not to work.

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