Contemporary Welfare Regimes in Baltic States: Adapting Post-Communist Conditions to Post-Modern Challenges

Abstract

This article revises the conventional approach to welfare state development in the post-communist world, according to which the main challenge for the Eastern European states is to catch up with Western European welfare regimes. The article argues that adjustment to the new social risks and volatile markets is more important today than the catching-up scenario. Based on social and labour market statistics for Estonia, Latvia and Lithuania, the article analyses how the Baltic States are coping with this adjustment challenge. Adaptation to the post-modern conditions can be regarded as successful if the stability of welfare spending is accompanied by the expanding and flexible employment and by the stable or decreasing level of poverty. The findings suggest that the opportunities to increase the flexibility and equality of the labour market provided by the breakdown of the communist regime were not used. Instead, the Baltic welfare states continue to focus on protecting against the old social risks by combining neoliberal and post-communist principles. Poor performance in meeting new social risks poses a greater challenge for the post-communist welfare states than their lag in terms of gross welfare expenditure.