How Does Decentralisation Affect the Welfare State? Territorial Politics and the Welfare State in the UK and US

Abstract

The relationship between political decentralisation and the welfare state is much studied, and large-scale studies have repeatedly found that decentralised states have less generous welfare states. How do we fit that with other studies that emphasise the potential of decentralisation to raise welfare standards? This article argues that decentralisation, as a variable, is too broad and it is more efficient to focus on the structure of veto players in the central state, intergovernmental relations and intergovernmental finance. Those are the actual mechanisms that connect decentralisation to the welfare states, and they can all vary independently of decentralisation. It uses recent changes in the United States and United Kingdom as examples. The fragmentation and average weakness of the US welfare state is mostly due to a federal government riddled with internal veto points that permits considerable interstate variation and low overall average provision, while tight central control on finances in the UK means that most variation is in the organisation, rather than levels, of social services.