Migration and the Political Economy of the Welfare State

Abstract

National welfare states are compelled by their logic to be closed systems that seek to insulate themselves from external pressures and that restrict rights and benefits to members. They nonetheless fail to be perfectly bounded in a global economy marked by competition, interdependence, and extreme inequality. This article explores the consequences of transnational flows of labor both for the status of migrants who move to welfare states and for the viability of welfare states themselves. The consequences of migration for the fiscal and political stability of welfare states are discussed, and it is argued that migration has contributed to the Americanization of European welfare politics. It is concluded that the relatively free movement of labor across national frontiers exposes the tension between closed welfare states and open economies and that, ultimately, national welfare states cannot coexist with the free movement of labor.