Economics of the Welfare State

Academic year
Subject Area
Área Científica do Menor
Language of Instruction
Mode of Delivery
ECTS Credits
1st Cycle Studies

Recommended Prerequisites

This is an advanced optional undergraduate course in economics. Previous background in public economics is helpful, but not strictly required. Although a course in economics this is intended to be also accessible to students from other related areas.

Teaching Methods

The course mixes lectures, discussion of questions and problems and analysis of small texts, documents and reports. Lectures will provide the resources (theoretical and empirical) needed to think about the welfare state and social policies. Students will be actively engaged in the learning process. Extensive time will be dedicated to provide guidance and support to students’ own work - whether in group, pair, or individual. Some tutorials (in class but mostly during office hours) will be assigned to preparation of one paper on a specific welfare state regime / social policy.

Learning Outcomes

This course aims to provide an analytical framework, based on economic theory, for thinking about the welfare state and discuss specific arrangements and policies in an international context.

By the end of the course students should:

- have learnt the basic concepts and tools needed to discuss welfare states and policies;

- understand the rationale of the welfare state;

- know the origins, development and main features of different welfare state regimes;

- grasp the economic reasons usually provided to ground each of the public policies studied in the course and be able to discuss these policies;

- understand the nature of the sustainability issue.

In addition, it is expected that students develop the ability to analyze and discuss material critically, to use data to support arguments, work autonomously and in group; acquire the necessary tools and skills for writing a good paper, and exercise critical thinking and argumentative abilities.

Work Placement(s)



I - The welfare state in theory: why do we have a welfare state?

1. Introductory issues

2. Political and philosophical views on the role of the government

3. Economic theory(ies) of state action and the borderline(s) between government and markets

4. Problems of definition and measurement

II - The welfare state in practice: arrangements, policies and challenges

5. Origins and development of the welfare state. Worlds of welfare.

6. Welfare policies: unemployment, sickness and disability insurance; old-age pensions; inequality and poverty; healthcare; education and training

7. Recent trends and challenges: the sustainability issue.

Assessment Methods

Attendance and informed engagement in the course and in the activities of the class : 20.0%
Research work: 30.0%
Mini Tests: 50.0%


- Barr, Nicholas (2012), Economics of the Welfare State, 5th edition, Oxford: Oxford University Press

- Castles, Francis et al. (eds.) (2010), The Oxford Handbook of the Welfare State, Oxford: Oxford University Press

Complementary readings will be provided and made available online (nonio) in due course.