ABSTRACT
The advanced capitalist welfare states developed their characteristic aspirations, policy patterns, sources of finance, and institutional structures in the decades following World War II under conditions in which the nation state was able to exercise a historically exceptional degree of control over its own economic boundaries. This chapter focuses exclusively on the adjustment of employment and welfare systems to challenges arising from the international integration of product and capital markets that had slowly increased after the 1960s, but reached new levels of intensity in the late 1980s and 1990s. In the comparative political economy literature, there is considerable dispute over the question of whether economic globalization does, or does not affect welfare-state policy at the national level. The chapter discusses the general challenges with regard to their effects on employment and on the financial viability of advanced welfare states.
