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Abstract

This paper tests 'political' and 'economic' models of welfare expenditure with post-World War II Australian data. The major antecedents of welfare spending for the overall time period (1945-1979) appeared to be economic growth as mediated by the age of the population and program incrementalism. It was shown, however, that this view misleads rather than clarifies the influence of different factors during specific periods within the overall time series. A periodization of welfare spending was found to be more useful. The periodization analysis showed that the influence of politics on welfare spending is important. Right political strength was found to have a negative impact on spending levels and the equality of aged pensioner incomes. It was also shown that program incrementalism does not reduce inequality.

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