The World of Three Worlds

The Three Worlds arrived at a time when the dominant scholarly understanding of the welfare state was exhausted. Emphasizing the role of industrialization, the prevailing model — developed in the work of Harold L. Wilensky and others — had two key components. The first was the idea that welfare states had blossomed since the late nineteenth century as a byproduct of industrialization, economic growth, and the breakdown of preindustrial communities. As societies industrialized, the argument went, they grew richer and urbanized, generating strains and needs that required state intervention.

The second pillar of the industrial society scholarship was its view that welfare state development was a unilineal phenomenon that could be gauged using social expenditures. Modern welfare states were understood to differ primarily in quantitative terms — there was more or less welfare state, and welfare states grew or contracted in some relationship to society’s industrial development. Moreover, as countries industrialized, their welfare systems would converge.

In the 1970s and 1980s, a new crop of scholars challenged this dominant paradigm — highlighting its failure to grapple with the politics of welfare state formation, as well as the qualitative differences in welfare systems that couldn’t be captured by looking at the level of social spending. Though liberal pluralists, neo-Marxists, and feminists would all develop incisive critiques, it was the “power resources” perspective, promoted primarily by Scandinavian scholars like Walter Korpi and Esping-Andersen, that ultimately displaced the logic-of-industrialism view.

The power resources scholars pointed to class struggle as a crucial factor in the emergence of welfare states and looked to explain cross-national variation by examining the relative strength, mobilization, and organization of the working class and its allies. In other words, there was no single welfare state and thus no single story of its development. There were many stories, and though welfare states differed in important ways, workers were always critical protagonists, even if their achievements varied.

What Welfare States Look Like — and Why It Matters

A weakened industrialism perspective, an appreciation for institutional variation, an emphasis on political struggle — these were elements of the theoretical universe in which The Three Worlds emerged. The book, which runs less than 250 pages, offers a novel theory of the origins and effects of what Esping-Andersen terms “welfare regimes” — distinct models for how “state activities are interlocked with the market’s and the family’s role in social provision.” He famously describes three.

The liberal welfare regime, exemplified by countries like the United States and Australia, makes extensive use of means-testing, strict eligibility rules, and minimum benefits to encourage dependency on the market for making ends meet. In general, Esping-Andersen writes, the “liberal paradigm” posits “that public obligation holds only where the market fails: the commodity-logic is supreme.” In liberal welfare regimes, state intervention through public provision is typically understood to be inefficient and morally corrosive.

The conservative — also called corporatist, etatist, or Bismarckian — welfare regimes of continental Europe are paternalistic, preserving traditional privileges and the patriarchal family as the locus of welfare provision. Countries with this regime type tend to have histories of precapitalist development characterized by feudalism and patronage, strong religious authorities, and statist conservatism.

Finally, the social democratic welfare regime, represented by the Scandinavian countries, features relatively generous benefits and services administered by the state to individuals — as opposed to, say, patriarchal families — on the basis of universal social rights. As Esping-Andersen writes, “All benefit; all are dependent; and all will presumably feel obliged to pay.”

Though all countries have a mix of features from these three “ideal types” (some means-testing here, a universalist policy there), Esping-Andersen argues that over time, we have seen national welfare systems diverge into these distinctive clusters. He argues that a country’s movement toward either the liberal, conservative, or social democratic welfare regime reflects three things: “First, the pattern of working-class political formation . . . second, political coalition-building in the transition from a rural economy to a middle-class society . . . [and] third, past reforms [that] have contributed decisively to the institutionalization of class preferences and political behavior.”

Norway is a good example. Its social democratic welfare regime was not the expression of a uniquely egalitarian culture or an elite attempt to save capitalism from its own contradictions. Rather, it resulted from workers’ success in developing muscular political (the Norwegian Labor Party) and labor organizations (the Norwegian Confederation of Trade Unions) in the late nineteenth and early twentieth centuries; building alliances with rural counterparts in the 1930s (i.e., the “red-green” alliance); and promoting inclusive, high-quality social programs and benefits that won middle-class support.

There was a practical motivation here. While universalist social policies were undoubtedly about protecting people from the vicissitudes of the market, they were also about entrenching a powerful political coalition that would guarantee the continued dominance of social democratic parties and their values. With middle-class support, these parties — particularly in Norway and Sweden — achieved extraordinary electoral success in the decades after World War II in crowded, multiparty fields.

In his book, Esping-Andersen quantifies the difference between welfare systems in terms of both social stratification and “decommodification,” or “the degree to which individuals, or families, can uphold a socially acceptable standard of living independently of market participation.” He considers three dimensions of decommodification: benefit eligibility and conditionality (means testing, work performance, universal rights), income replacement, and the range of entitlements. Using pension, sickness benefit, and unemployment insurance data from 1980, he assigns “decommodification scores” to eighteen OECD countries. After running the numbers, Esping-Andersen finds that the Scandinavians decommodify the most; the Americans and Australians the least; and Central, Western, and Southern Europe fall somewhere in the middle.

In essence, Esping-Anderson was measuring the progress that different countries have made toward “social citizenship,” or what T.H. Marshall describes as “the right to a modicum of economic welfare and security to share to the full in the social heritage and to live the life of a civilized being according to the standards prevailing in the society.” Where decommodification is high, a person’s standard of living and ability to participate in the political, social, and cultural life of their community are less tied to the market value of their labor power. A welfare regime, in other words, can be an instrument of emancipation.

The Academic Response

The Three Worlds was met with both acclaim and critique. Criticism revolved around a few key issues. First, feminist scholars — chief among them Ann Orloff — noted the book’s absence of gender and feminist politics. By focusing on class without gender, they argued, Esping-Andersen overlooked an important dimension of social stratification and political struggle, as well as significant axes of material dependency that limited freedom — for instance, that of women on a male breadwinner.

A second critique targeted Esping-Andersen’s typology and welfare-regime models. Scholars pointed out that the conservative welfare regime was perhaps too capacious — it seemed sensible to group the Mediterranean countries, with their unique blend of corporatism, fragmentation, and clientelism, into their own “southern” or “Mediterranean” welfare regime cluster. And what of the countries outside of Esping-Andersen’s original eighteen? Further scholarly consideration multiplied the “worlds of welfare capitalism”: Antipodean welfare regimes, Eastern European and postcommunist welfare regimes, East Asian “Confucian” welfare regimes, and so on.

This potential for taxonomizing goes a long way toward explaining the influence of The Three Worlds. Beyond furnishing social scientists with a vocabulary for making sense of and describing the qualitative differences between welfare regimes, the book helped launch the “welfare modeling business” — a multidecade social scientific endeavor to refine Esping-Andersen’s typology and propose new typologies. Even if the tinkering with typologies has now hit a wall, the remarkable effort to taxonomize the world’s welfare systems has enhanced our ability to speak about abiding institutional differences in a globalizing, neoliberalizing world.

And still, there is plenty left to consider. As a cultural anthropologist of contemporary Norway, my interest in The Three Worlds was initially piqued by its discussion of social democratic welfare regimes. In light of my recent fieldwork on the unemployed in Oslo, however, I have been drawn to the implications of its argument for culture and morality.

After all, though the terms that Esping-Andersen uses in the book — family, state, market, and so on — all appear to have the same meanings whether applied in Norway, the United Kingdom, or France, this is clearly not the case. Each of these abstractions is understood and experienced in ways that reflect their relative significance in different stages of a person’s life, and as we know from Esping-Andersen, that significance corresponds to the architecture of a country’s welfare regime. Thus, the Norwegian state is not the American state, nor is a Norwegian family an American family. What these things mean, what an individual owes to them, and what they owe to the individual when times are tough differs from place to place, from regime to regime.

This suggests that “welfare reform” is a far more expansive — and fundamental — project than just tinkering with benefits and services. It has the potential to remake the institutional environment within which we live, and in doing so, remake our very understanding of what the state (or family or firm) is and what it is for.

Decommodifying Our Way to Freedom

More than three decades after its release, The Three Worlds still has much to teach us. For Americans, in particular, it remains an eye-opening journey into other worlds of social policy and social stratification. It shows that the differences between these worlds are in large part the result of poor and working-class struggles to detach individual and collective flourishing from the whims of the labor market.

Where this struggle has been most successful, we find flourishing democracies, higher levels of human development, and happier populations. We also find young people who, in general, have better labor protections, more disposable income, less debt, and much less anxiety about health care, unemployment, and retirement. This concept of decommodification provides a yardstick by which the Left can measure its progress — and better understand its destination.

Even as The Three Worlds confirms that the United States is not Denmark, it nevertheless illuminates the path toward the Nordic example. For it is not necessarily about how much a society spends but about how it spends, what it spends it on — and how much it emancipates people from having to sell their time for a wage.