The determinants of social spending in Spain (1880-1960): Is Lindert right?

Abstract

The main objective of this paper is to analyse the origins of the welfare state in Spain using the theoretical framework designed by Peter Lindert. With this aim, we offer an econometric analysis of the factors that determined the evolution of the Spanish social spending between 1880 and 1960. By using new quantitative evidence, we constructed a panel-data set divided in five years periods with the percentage of social spending disaggregated in three groups: health care, social security and welfare. Our analysis allows us to put the Spanish case within the international debate on the historical determinants of the welfare state. The results obtained highlight a number of interesting features specific to this country. On the one hand, Spanish social spending as a percentage of GDP remained relatively low compared to the figures recorded by other countries during the period under study. On the other hand, demographic factors played a determining role in the initial stages of the development of welfare state, while economic growth had a more ambiguous influence. The political and public finance variables also exercised some influence on the growth in public spending. However, globalisation was not a motivating force behind the welfare state in Spain.political economy, welfare state, public policy, spanish social policy, determinants of growth of public social spending