Social equality and economic efficiency: an international comparison based on net total social expenditure data

There is no conclusive empirical evidence about the relationships between social expenditure and economic outcomes, notwithstanding a theoretical framework characterized by the equality-efficiency trade-off. Some statistical problems arise from wide differences in the design of the social protection schemes and in the sources of financing. New Oecd data about net total social expenditure referred to 2005 help us to prevent such problems, sketching a new system of social accounting focused on the sum of public net social expenditure and private out-of-pocket spending. In the Oecd countries, a low public social expenditure implies an high private spending, so that the shares of national product devoted to social purposes are similar in Continental Europe and in Anglo-Saxon countries. However, such differences in the public-private mix of social spending have an impact on effective protection from social needs and on the distribution of social well-being.