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Social Insurance as Fiscal Policy and State-Building Tool: The Development and Politics of Payroll Contributions in Israel and Canada

Published online by Cambridge University Press:  25 April 2018

DANIEL BÉLAND  and
MICHAL KOREH
DANIEL BÉLAND
Affiliation:
Johnson Shoyama Graduate School of Public Policy, University of Saskatchewan, 101 Diefenbaker Place, Saskatoon, Saskatchewan, CanadaS7N 5B8 email: daniel.beland@usask.ca
MICHAL KOREH
Affiliation:
School of Social Work, University of Haifa, 199 Aba Khoushy Avenue, Mount Carmel, Haifa. 3498838, Israel email: korehm@gmail.com
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Abstract

The scholarship on state-building has devoted a significant amount of attention to the role of taxation in building state institutions and capacities. It has also emphasised the crucial role of taxation in driving state-society relations. Scholars have argued that the linkage between taxation and state building also applies to the area of social policy. In this paper, we draw on a fiscal-centred perspective on welfare state development that highlights the fiscal policy role of social insurance as a revenue raising institution to study the fiscal relationship between social insurance and state-building in Israel and Canada – two ‘most dissimilar cases’ that nonetheless feature strikingly similar patterns with regard to this relationship. As our findings show, in both cases, social insurance programmes were introduced, designed, and utilized to advance fiscal and economic policy capacity and thereby promote state building. Using these programmes and the commitments they created, political actors could legitimize the generation of revenues, build institutional infrastructure for tax collection, and create capital reserves for investing in the economy.

Type
Article
Information
Journal of Social Policy , Volume 48 , Issue 1 , January 2019 , pp. 1 - 20
Copyright
Copyright © Cambridge University Press 2018 

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