Hyejin Ko,

Korea Institute for Health and Social Affairs

Sejongsi, South Korea

E-mail Kohyejin@kihasa.re.kr

Determinants of social expenditures in post-socialist countries

Kichae Min,

Korea National University of Transportation

Chungcheongbukdo, South Korea

E-mail: minkichae@hanmail.net

Abstract. This study compares the development of the welfare state between Western capitalist countries and a selection of post-socialist countries of both Asia and Europe by examining the determinants of social expenditures in those. A pooled time-series, cross-sectional analysis with panel-corrected standard errors was conducted on the determinants of social expenditures in 21 post-socialist countries: Albania, Azerbaijan, Belarus, Bulgaria, Croatia, Czech, Estonia, Georgia, Hungary, Kazakhstan, Latvia, Lithuania, Moldova, Poland, Romania, Russia, Serbia, Slovakia, Slovenia, Ukraine, and Uzbekistan, using 2005 to 2017 data. It was found that, as in Western societies, democratic and welfare systems are more developed in post-socialist states than in welfare states. However, the effects of socialist heritage and globalization differ, depending on the degree of economic development of the country concerned. While in the OECD countries, globalization leads to the development of the welfare state, in non-OECD countries, socialist heritage is an enabling condition for development of the welfare state.

Received: January, 2019

1st Revision: February, 2019

Accepted: May, 2019

DOI: 10.14254/2071-789X.2019/12-2/15

JEL Classification: D02, O17, P31

Keywords: post-socialist countries, social expenditure, welfare state, linear regression with panel-corrected standard errors