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Gruendler, Klaus und Koellner, Sebastian (2020): Culture, diversity, and the welfare state. In: Journal of Comparative Economics, Bd. 48, Nr. 4: S. 913-932

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Abstract

We examine how cultural socialization and diversity influence welfare systems. Our sample includes 134 countries (1975-2014). We employ spatial patterns and biological characteristics as instrumental variables for culture. The results show that culture is an important predictor for the generosity of welfare states: welfare provision is higher in countries with loose family ties and individualistic attitudes, high prevalence of trust and tolerance, and low acceptance of unequally distributed power. These channels explain 20-50% of the cross-country variation in welfare provision. Cultural heterogeneity (diversity) influences redistribution non-linearly: moderate diversity levels impede redistribution, while higher levels offset the negative effect.

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