The Political Economy of Immigration and Welfare State Effort: Evidence from Europe 25 Female labour force participation has a positive and statistically significant effect on both spending and the generosity index. It is likely that female labour force participation increases welfare state effort through the need for improved child-care infrastructure. Soroka et al. (2016) also suggest that increased spending may be linked to increased costs from supporting a larger work force, e.g. training, insurance, and leave. Furthermore, the findings indicate that union membership and support may be more important for determining welfare state effort than the strength of left parties. Union density is positively and significantly associated with the generosity index, while the proportion of left cabinet seats is not significantly associated with either indicator. For unions, the difference in results is quite likely to be related to the programmes that are included in the generosity index; pensions, sickness, and unemployment benefits are closely linked to labour market participation and tend to insure workers from labour market risks. Plus, this is similar to the results found by Lipsmeyer and Zhu (2011) who argue that domestic political pressures are important for explaining higher unemployment compensation in an age of increasing immigration. For left cabinet seats, there is considerable debate about the importance of partisan politics on the expansion and retrenchment of the welfare state (Allan & Scruggs, 2004; Pierson, 1996; Rueda, 2006), the results here would support Pierson (1996) and the ‘new politics of the welfare state’. Finally, in contrast to Gaston and Rajaguru (2013) who find a statistically significant, negative relationship between economic globalisation and social spending, there is no significant impact of the KOF economic globalisation indicator on either social spending or the generosity index. Similarly, in contrast to Iversen and Cusack (2000) there is no significant association between deindustrialisation and either social spending or the generosity index. Overall, the analysis provides no evidence for the first hypothesis proposed – that increasing immigration leads to welfare state retrenchment. Rather, the positive association between foreign-born and spending, and the neutral association between foreign-born and generosity, provide some evidence for the alternative hypothesis – that increasing immigration leads to welfare state expansion, although, the two dependent variables do not show identical outcomes. In order to explain the difference between spending and generosity, it is important to note that they provide slightly different operationalisations of welfare state effort – budget size versus benefit type and entitlement criteria, and they are constructed in different ways. As a consequence, the differences between the two indicators could be down to modelling or substantive reasons. In the case of modelling, for example, it may be that for one indicator there is an omitted variable but not for the other, or that the appropriate model specification may be slightly different for each dependent variable. How-
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