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Welfare and Work in the Open Economy Volume II: Diverse Responses to Common Challenges in Twelve Countries$
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Fritz W. Scharpf and Vivien A. Schmidt

Print publication date: 2000

Print ISBN-13: 9780199240920

Published to Oxford Scholarship Online: November 2003

DOI: 10.1093/0199240922.001.0001

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France Directing Adjustment?

France Directing Adjustment?

Chapter:
(p.308) 7 France Directing Adjustment?
Source:
Welfare and Work in the Open Economy Volume II: Diverse Responses to Common Challenges in Twelve Countries
Author(s):

Jonah D. Levy (Contributor Webpage)

Publisher:
Oxford University Press
DOI:10.1093/0199240922.003.0007

The Bismarckian welfare state in France is financed by social security contributions to an even greater degree than is true in Germany. During the oil‐price crises of the 1970s and early 1980s, job losses could be contained through an expansion of nationalized industries and subsidies to private firms. This changed with the end of dirigisme in industry after 1983. Thereafter, early retirement was expanded to absorb the massive job losses caused by industrial restructuring. Since rising non‐wage labour costs impeded job creation in the private services, the government has shifted part of the burden to a special income tax, whereas attempts by successive governments to reduce the generosity of welfare benefits were typically blocked by large‐scale public protests.

Keywords:   Bismarckian welfare state, dirigisme, early retirement, France, industrial restructuring, nationalized industries, non‐wage labour costs, oil‐price crises, public protests, social security contributions

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