PSC 1001 Chapter Notes - Chapter 3: Currency Union, Redistribution Of Income And Wealth, Population Ageing
Document Summary
Since the oil shocks of the 1970s, europe has worried about sustainability of its economic and social model: based on high levels of income redistribution, extensive social insurance. European welfare states are resilient: social model -- protection against risks of old age, sickness, unemployment are strong, resilient during economic rises of 1970s and 1990s. Post 2008 crisis, some european countries are still suffering. Some italians and spaniards are approaching retirement without social protection. Europe"s unresolved challenges confronting its welfare states: population aging and declining fertility rates and longer life expectancies. Problem funding retirement: big imbalance in the low-skilled segment of labor market, where supply exceeds demand. Low-skilled workers have difficulty finding stable employment. Low-wage employment + welfare state = not feasible. General upgrading of skills among workers in most advanced economies. Surpluses of low-skill labor have caused wages to plummet: european societies have become more multicultural. More likely to end up on welfare.
