ABSTRACT
When Adolf Wagner suggested his law of increasing public expenditures out of GDP in the second half of the nineteenth century, he thought of not only the future need for public services but also the growing relevance of public insurance. Wagner saw the coming industrial society as harbouring incredible richness which could partly be used to secure a certain standard of living for the working classes when adversity strikes. The labour movement would, he clearly saw, demand compensation for the risks that industrialisation brought with it (Buchanan and Musgave, 1999).
