An analysis of the welfare state can only succeed, when insight with regard to the income distribution exists. The present column presents a model for describing the social insurance. People appreciate security. Unfortunately, such insurances are amenable to adverse selection and moral hazards. Practical experiences are discussed, with small funeral funds, the insurance companies De Centrale and Bond Moyson, initiatives by the christian movement, and unemployment funds. Private initiatives are merely partly able to offer social security .... Read more
30-08-2021: The distribution of incomes
Author: E.A. Bakkum
Until now the Gazette has not paid much attention to the theory of income distribution. However, this theory is indispensable in the analysis of the welfare state. Therefore the present column discusses the main principles. The difference between gross and nett incomes is explained. Various pictures of the income inequality are shown, such as the frequency distribution and the Lorenz diagram. Several common measures of income inequality are described, among others the parameter of Pareto and the Gini coefficient .... Read more
20-08-2021: The evolution of institutions
Author: E.A. Bakkum
Economists become more and more interested in the social evolution, which is driven by the interactions between interest groups. The present column briefly discusses several essential aspects of evolution, such as group dynamics and the search for a good policy mix. The aim is to establish a social equilibrium. This is illustrated with an explanation of the coordination problems between groups, free riding within the group, and the application of game theory and population models on the evolution .... Read more
25-07-2021: Annotations regarding the welfare function
Author: E.A. Bakkum
Social welfare functions help to analyze questions regarding the distribution. They give insight in the moral choices of policy formation. The present column discusses several of these functions, and combines them with models of monetary utility, among others those of Ragnar Frisch. They are also compared with the justice theory of Rawls, albeit in the interpretation of Binmore. This knowledge is compared with older texts in the Gazette. Finally, related reports of the CPB and the WRR are discussed .... Read more
14-06-2021: Five years analysis of the welfare state
Author: E.A. Bakkum
The industrialization creates so much wealth, that it leads to the welfare state, The welfare state has a large diversity of forms. The present column describes several models, which try to order the diversity. After a general introduction about group behaviour and the policy mix there is a presentation of: the inclusion model, the paradigm of the radical centre, the trust model, and the three-worlds model. Finally, reports of the CPB and the WRR are discussed .... Read more