I. The Present Malaise -- The Past Rise of Social Security: Historical Trends and Patterns -- Moral Hazard in the Welfare State -- Comment on Lars Söderström "Moral Hazard in the Welfare State" -- II. The Welfare State at a Crossroad: Fundamental Choices -- Pros and Cons of a Negative Income Tax -- Comment on Hans-Georg Petersen "Pros and Cons of a Negative Income Tax," -- The Future Scope for Self-Reliance and Private Insurance -- Comment on Alan Peacock "The Future Scope for Self-Reliance and Private Insurance," -- III. Reform Issues of Specific Welfare Systems -- The Swedish Model: Past, Present, and Future -- Reforming the Welfare State: The German Case -- Comment on Norbert Berthold and Rainer Fehn "Reforming the Welfare State: The German Case," -- The Worm at the Root: An Exploration of the British Welfare Case -- IV. Reform Issues in Specific Areas of the Welfare State -- Old-Age Pension Systems: A Theoretical Evaluation -- International Reforms of Health Care Systems: Quasi Markets, Privatization, and Managed Care -- Comment on Richard Scheffler "International Reforms of Health Care Systems: Quasi Markets, Privatization, and Managed Care," -- Unemployment Compensation: Theory and Practice -- From Welfare State to Social State: Individual Responsibility and Compassion -- V. Explaining Private Giving -- On the Transfer Value of Gratitude -- About the Authors.

This book is the sequel to Fighting Europe's Unemployment in the 1990s, the collection of papers presented at the Salzburg Symposium of the Egon-Sohmen-Foundation in 1994. Though the problem of un­ employment was urgent already then, it has not found a practical solution in the meantime, and even intellectually it remains somewhat of a mystery. A clue is offered by the contrast with the United States: they have the working poor; we, on the old continent, have the welfare recipients. This brings the relationship between unemployment and the welfare state to the fore. On closer inspection, however, the matter appears to be much more complicated than the transatlantic contrast suggests. Consider only that the welfare state and what is called "social policy" have a long tradition in Europe. They obviously did not pre­ vent or noticeably hamper the decline in unemployment in the 1950s and the emergence of full employment in the 1960s. This leaves room for various conjectures. Does the welfare state matter only after a long time lag or after it has grown too fast or too much beyond a critical size? Is it the welfare state per se that is harmful to employment or do its harmful effects arise only under certain conditions, e. g.