Social insurance and the German political economy

Studies of the welfare state usually try to find out which factors have contributed to its ascendancy since the end of the nineteenth century and which factors explain the various approaches different countries took in providing a new social insurance to cover new social risks in industrialized society. Among the many paths government and society could have taken toward institutionalizing social security, why were particular ones chosen? The following question, however, has not yet been the subject of thorough investigation: To what extent is the welfare state itself an explanatory variable for the route taken by each industrialized country? Recently there has been a growing interest in the large variations among countries regarding their social systems of production (Boyer/Hollingsworth). But, interestingly, such research has failed to examine the welfare state's role in the development and stabilization of different systems of production. Using the history of the coevolution of the Bismarckian welfare state and the German 'corporative market economy' as an example, the author demonstrates that scholars who overlook the connection between the development of the welfare state and of national capitalism will be unable to adequately understand the inner workings of each.