ABSTRACT
Chapter 7 sheds new empirical light on the models of social protection system co-existing in the European Union by the middle of the present decade. The subspace clustering exercise (ORCLUS algorithm) carried out in the chapter allowed to identify three models of social protection in EU25 economies and to track their evolution in the 2005–2014 period while simultaneously highlighting the role of “path dependence” as a key determinant of the institutional architecture in this particular domain. The high taxes and public consumption model was found in Denmark and Sweden; a generous benefits model was embodied in the rest of the EU14 member states as well as in Slovenia and Croatia; and a private mode of coordination model predominated in other CEE11 countries. The chapter also delves into the main underlying reasons that might explain the diverging evolutionary paths of the social protection systems in two CEE11 countries (Croatia and Slovenia), which were identified as outliers from the separate CEE cluster in this area.
