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Measuring and Comparing Policies - Expenditure

Q: What does expenditure stand for?

What is being measured? spending indicator of generosity of benefits ( or of importance of addressing the problem through policy )? spending indicator of costs (or of an ineffective policy or policy implemented in a wasteful manner)? hidden costs or possibly inefficient use of resources? interdependent effect of the context ex.1 population size wealth of a country --> GDP often used as the denominator to make figures comparable between countries by taking into account part of the context ex.2. population size: a country with a more aged population structure will spend more on pensions and less on family benefits

Q: Trends in Expenditure: Three (3) changes

Three types of changes that might result in [an increase or a decrease of] social expenditure : Generosity of benefits entitlement ( how high are benefits or how good are the services that those who have a right to receive them or make use of them ) Access to benefits eligibility criteria ( who can apply or is automatically granted those benefits or can make use of a service ) Size of the (potential) population of beneficiaries social need ( how large is the population in a country that needs to rely upon the benefit or the service )

Q: Quality of National spending data

Poor quality of macro data and statistical breaks in time series differences between countries where transfers are primarily funded via general taxation and managed by central government and countries where there is more devolution towards lower levels of government (e.g. NL: AWBZ to WMO and WOZ); or towards intermediate actors such as social partners, and social insurance funds (e.g. NL: supplementary pensions) or semi-private or private institutions (ex. sickness benefits) measurement errors are often larger than annual changes

Q: The social construction of public expenditure data

difference between 1) administratively reported data , 2) total financial costs for the economy of a country and 3) total costs to society and these differences are not randomly distributed all data are social constructions (and so are administrative data constructed by the civil service) public and private social expenditure gross versus net social expenditure

Q: Why is (disaggregated) expenditure important?

“ The budget is the skeleton of the state, stripped of all misleading ideologies ”(Rudolf Goldscheid, 1917) (--> Schumpeter)• “ Money is not all there is to policy, but there is precious little policy without it ”(Hans-Dieter Klingeman et al., 1994) Political salience of “ permanent austerity ” (Paul Pierson, 2001)

5 important questions on Measuring and Comparing Policies - Expenditure

What does expenditure stand for?

What is being measured?

spending indicator of generosity of benefits (or of importance of addressing the problem through policy)?
spending indicator of costs (or of an ineffective policy or policy implemented in a wasteful manner)?

hidden costs or possibly inefficient use of resources?

interdependent effect of the context

ex.1 population size wealth of a country --> GDP often used as the denominator to make figures comparable between countries by taking into account part of the context
ex.2. population size: a country with a more aged population structure will spend more on pensions and less on family benefits

Trends in Expenditure: Three (3) changes

Three types of changes that might result in [an increase or a decrease of] social expenditure:

Generosity of benefits

entitlement (how high are benefits or how good are the services that those who have a right to receive them or make use of them)

Access to benefits

eligibility criteria (who can apply or is automatically granted those benefits or can make use of a service)

Size of the (potential) population of beneficiaries

social need (how large is the population in a country that needs to rely upon the benefit or the service)

Quality of National spending data

Poor quality of macro data and
statistical breaks in time series
differences between

countries where transfers are primarily funded via general taxation and managed by central government and
countries where there is more devolution towards lower levels of government (e.g. NL: AWBZ to WMO and WOZ); or towards intermediate actors such as social partners, and social insurance funds (e.g. NL: supplementary pensions) or semi-private or private institutions (ex. sickness benefits)

measurement errors are often larger than annual changes

The social construction of public expenditure data

difference between

1)administratively reported data,
2)total financial costs for the economy of a country and
3)total costs to society

and these differences are not randomly distributed

all data are social constructions (and so are administrative data constructed by the civil service)
public and private social expenditure
gross versus net social expenditure

Why is (disaggregated) expenditure important?

“The budget is the skeleton of the state, stripped of all misleading ideologies”(Rudolf Goldscheid, 1917) (--> Schumpeter)•

“Money is not all there is to policy, but there is precious little policy without it”(Hans-Dieter Klingeman et al., 1994)

Political salience of “permanent austerity” (Paul Pierson, 2001)