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The Developing Economies

Volume 42, Number 2 (June 2004)

The Developing Economies ■ The Developing Economies Volume 42, Number 2 (June 2004)
■ B5
■ 105pp.
■ Published in June 2004
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Kim Jo-Seol, "Formation and Development of the Welfare State in the Republic of Korea: Process of Reform of the Public Assistance System," pp. 146-75.

The legal framework for social security in the Republic of Korea began to be formed in the early 1960s (the first period) and further progress was made during the process of democratization in the 1980s (the second period). However, it remained a "top-down" residual system, preserving conservative elements. With the constitutional lawsuit over the right to life in 1994 as a turning point, however, there was a major shift to a universal system, supported by "bottom-up" efforts through petitions to the National Assembly and legislation by Assembly members. This led to the enactment of the Framework Act on Social Security (1995), the National Basic Livelihood Security Act (1999) and other measures (the third period). This paper attempts to analyze the Korean-style welfare state by tracking these institutional changes as well as the main actors.

Lin Chen-Wei, "State Reformation and the Formation of a Newly Emerging Welfare State in Taiwan," pp. 176-97.

In postwar Taiwan, the legitimacy of the Kuomintang (KMT) regime had depended on the cold war structure and the civil war with the Communist Party. As the KMT regime penetrated Taiwanese society, it exercised tight control over the society through the medium of the strong party organization. However, in the process of democratization that started in the 1980s, the KMT's authoritarian political rule began to crumble, forcing the government to respond to people's demands in order to survive. The reform and improvement of the social security system in Taiwan were brought about against this backdrop of state reformation.

Yukari Sawada, "The Social Security System in Hong Kong: Establishment and Readjustment of the Liberal Welfare Model," pp. 198-216.

Hong Kong's social security system has followed a "liberal" welfare state regime. The system has undergone changes along with the high economic growth, changes in the labor market, and transformation of the political environment, but has retained the fundamental principle of a social security system led by the private sector. In recent years, Hong Kong has responded to the aging population and growing unemployment by introducing the Mandatory Provident Fund Scheme that requires individuals to join private-sector pension schemes and by intensifying cooperation with nongovernmental organizations. This indicates the deep-seated nature of the influence of the liberal regime in Hong Kong.

Koichi Usami, "Transformation and Continuity of the Argentine Welfare State: Evaluating Social Security Reform in the 1990s," pp. 217-40.

Beginning after World War II, Argentina institutionalized a limited conservative corporatist welfare state where occupation-linked social insurance held a central position and social assistance had a residual character. This was called a limited conservative corporatist welfare state, because the huge population within the informal sector was excluded from the main system. A populist government supported by trade unions and the economic model of import-substituting industrialization were the background for the formation of this type of welfare state. During the 1990s, elements of a liberal regime were added to the Argentine welfare state under the reform carried out by the Menem Peronist government. However, social insurance reform and labor reform were not as drastic as the economic reform. They still retained a certain continuity from the traditional systems. The government intended to carry out more drastic social security and labor reform, but was unable to do so due to the legacy of corporatism of the Peronist government.

Akiko Koyasu, "Social Security Reform by the Cardoso Government of Brazil: Challenges and Limitations of Reform Ten Years after 'Democratization,'" pp. 241-61

This article has two purposes. The first is to analyze politically why the Cardoso government's social security reform could not be completed. Though democratic political systems (election and political party systems) were reintroduced after the re-democratization in 1985, Brazil continued to suffer from elements of its traditional political culture such as corporatism, clientelism, nepotism, etc. These were the stumbling blocks for Cardoso's reform. The second purpose is to deepen understanding of Brazilian democracy by casting light on the behavior of political actors (the government, congress, and political parties) over social security reform issues under the Cardoso and Lula governments.

Tomoko Murai, "The Foundation of the Mexican Welfare State and Social Security Reform in the 1990s," pp. 262-87.

Before 1982 Mexico's welfare state regime was a limited conservative one that put priority on the social security of organized labor. But following the country's debt crisis in 1982, this regime changed to a hybrid liberal model. The Ernest Zedillo government (1995-2000) in particular pushed ahead with liberal reform of the social security system. This paper examines the characteristics and the policy making of the social security reforms in the 1990s. The results suggest that underlying these reforms was the restructuring of the economy and the need to cope with the cost of this restructuring. The paper also points out that one of the main factors making possible the rapid execution of the reforms were the weakened political clout of the officialist labor unions due to their steady breakdown during the 1990s and the increase in the monopolistic power of the state vis-a-vis the position of labor during the negotiations on social security reforms.

Hiroshi Sato, "Social Security and Well-Being in a Low-income Economy: An Appraisal of the Kerala Experience," pp. 288-304.

The State of Kerala, which is considered to have attained a level of social well-being comparable to that of advanced countries despite its relatively low income standard, is widely known as an example of "welfare by public intervention" in developing economies. This paper, focusing on the four areas of food provision, health services, elementary education, and pension schemes, and paying attention to the participation of the private sector as well as the activities of political parties and labor unions, points out that in Kerala, the private sector and organized activities have played a vital role, in addition to "public intervention," in the betterment of public welfare.

Kanako Yamaoka, "Cuba's Social Policy after the Disintegration of the Soviet Union: Social Development as Legitimacy of the Regime and Its Economic Effectiveness," pp. 305-33.

Since the disintegration of the Soviet Union, Cuba has experienced a severe economic crisis, and the country's social policy has played an important role in showing the people a raison-d'etre for the revolution. This role has become even stronger in recent years, as internal and external actors demand political reforms and economic liberalization. This article first examines the Cuban government's use of social development to counter the demands for changes. It then looks at the extent that government social policy contributes economically to improving the Cuban living standard.
The article demonstrates empirically how the leadership emphasizes their social accomplishments whenever demands for change come, and then shows that after the suspension of Soviet aid, Cuban social policy has been able to provide services mainly by relying on human capital and reducing quality materially because of the shortage of foreign reserves. This has limited the economic effectiveness of the services.