The Cost of Maintaining the Welfare State

Van, Germinal G. (2021): The Cost of Maintaining the Welfare State.

Abstract

The purpose of this essay is to explain how the cost of maintaining the welfare state does not produce the results intended in addition to creating an economic burden on the taxpayer from which he does not obtain any significant benefit. By cost, I do not merely imply monetary cost, but also a social cost. The welfare state exists in almost every advanced economy whether it is in Canada, France, the United Kingdom, Australia, or Germany. However, the analysis of this essay focuses on the welfare system of the United States since it is the country in which I reside.

Hence, this essay argues about how the welfare state could be dismantled by a gradual approach rather than an abrupt and revolutionary approach. To elucidate how the welfare state could be dismantled gradually rather than abruptly, I proceeded with the inductive method by first analyzing the historical and statistical evidence related to the welfare state, then developed a hypothetical scenario of the dismantlement of the welfare state.

• Item Type: MPRA Paper
• Language: English
• Keywords: Econometrics, Statistical Modelling, Welfare Economics, Statistical Analysis
• Subjects: C - Mathematical and Quantitative Methods > C0 - General > C01 - Econometrics; C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General; C - Mathematical and Quantitative Methods > C5 - Econometric Modeling; D - Microeconomics > D6 - Welfare Economics > D60 - General; D - Microeconomics > D6 - Welfare Economics > D62 - Externalities

References

1. Editors. “BRIA 14.3: How Welfare Began in the United States.” Bill of Rights in Action. (1998). Constitutional Rights Foundation.

2. Fishback, Price V. “New Deal.” Banking Crises: Perspectives from the New Palgrave Dictionary, edited by Garett Jones, Palgrave Macmillan UK, pp. 241-250.

3. Powell, Jim. How FDR’s New Deal Harmed Millions of Poor People. (2003). Cato Institute.

4. Ibid.

5. Tanner, Michael. “How Government Causes Poverty” Cato’s Letter. (2019) Volume 17, No. 2. Cato Institute.

6. Ibid.

7. Heil, Daniel. “Tax Rate Hikes and the Economy.” Hoover Institution. (2021).