Paths of the Past or the Road Ahead? Path Dependency and Policy Change in Two Continental European Welfare States

In contrast to what many critics claim, path dependency theory can explain both policy stability and change. It explains how public policy and institutions get increasingly consolidated, legitimated and protected by the elites governing a policy sector, and that precisely this rigidity preludes inevitable large-scale reform. Reform is the result of political behavior at a critical juncture in the history of a policy sector. This political behavior includes the use of crisis rhetoric to instigate reform. Crisis rhetoric has the most potential when institutional inertia has been building up during long periods of path-dependent policy development. This explains why similar welfare state predicaments in the Netherlands and Belgium lead to different reforms in the mid-1990s. Notes 1. In fact, Mahoney (Citation2000) distinguishes a functional perspective, a power resources perspective and a legitimizing perspective in addition to the utilitarian perspective. Mahoney's presentation of the legitimizing and the functional perspective does not enable us to discern them conceptually in the case analysis, however. In this study, those two perspectives will be taken together as one mechanism because institutional legitimacy and functionality to its environment (meeting external expectations with institutional performance) seem to be intimately linked. 2. Inactivity rates are the number of citizens of working age (between 15 and 65 years old) without salaried employment per 100 people from the labor force with salaried employment. In Belgium, 23.6% of the employed population received unemployment benefits, in the Netherlands 15.1% of the employed received disability benefits (1990 figures, Arents et al. Citation2000: annex C1.1–C1.11). 3. Social partners are here defined as representatives of capital and labor, i.e. the trade unions and the employers' organizations together. 4. In the Netherlands, social partners are no longer responsible for benefit administration (since 1994), but at the beginning of the 1990s (our reference period) they were. 5. Considering theories on veto points (Wilsford Citation1994) and veto powers (Immergut Citation1992). 6. The recession started after the oil crises of the 1970s and continued until the late 1980s. 7. The outcome of reforms does not suggest that the Dutch do a better job of solving their problems. The present day situation in Belgium and the Netherlands shows that, in spite of drastic reforms, the Dutch may have increased their activity rates, but still have not solved their disability insurance problems. The Belgians slowly but surely work on the activation of their unemployed and gradually improve their de facto retirement age by discouraging the use of pre-pensions. What is important here is that drastic reform was possible in the first place, and that it can be compared to a contrasting case in order to analyze what made the drastic reform possible. The Dutch and Belgian welfare states provide us with such cases. 8. Kuipers (Citation2006) includes a more elaborate analysis of the reproductive sequences. This article presents only briefly some of the main findings in order to illustrate the point that all three mechanisms and their effects were identified in both cases. 9. Government actors were fully aware of this use of public benefit schemes: “In some periods, our strategy was to ‘sweep up’ the labor supply [into social benefits], as we called it, after our Belgian colleagues. We relieved the labor market from its redundancy”, a high-ranked civil servant from the Ministry of Social Affairs explained (Kamerstukken, TK 1992–1993, 22730, no. 9 p. 163). 10. The construction of crisis can be identified as follows: 1) when change-oriented actors publicly use the word “crisis” to describe a highly undesirable situation that confronts society; 2) when they stress the urgency and necessity of drastic intervention; 3) when they appeal to society at large to comply and cooperate (“as if we were at war”); and 4) when a simplified account is given of the many symptoms of the identified crisis and its causes. Strong symbols or metaphors are used (“the Netherlands is sick”). Those metaphors convey an important message to a previously disinterested public: that it needs to support drastic intervention in order to solve a (highly dramatized) problem (Kuipers Citation2006; cf. Edelman Citation1977, ‘t Hart Citation1993). 11. Solidarity of the insured community apparently holds until a certain threshold; almost everyone is willing to pay a little extra tax to support the needy. Those beneficiaries can organize themselves and put pressure on government to make sure this care is guaranteed. When the number of beneficiaries increases, solidarity decreases. The burden becomes too heavy. In this sense one could say that 900,000 beneficiaries is a more forceful source of political support than 1 million beneficiaries (Kuipers Citation2006). Additional informationNotes on contributorsSanneke Kuipers Sanneke Kuipers is Assistant Professor at Leiden University's Department of Public Administration. In addition, she is a senior researcher-advisor at Crisisplan BV, an international consultancy firm specialized in crisis management. Her dissertation (Leiden, 2004) focused on crisis rhetoric and institutional reform, and was published by Amsterdam University Press under the title The Crisis Imperative: Crisis Rhetoric and Welfare State Reform in Belgium and the Netherlands in the Early 1990s (2006). She has also published on policy evaluation, accountability processes after crisis, institutional crises, EU crisis management, and EU decision making.