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The literature identifies two forms of business organization, Neocorporatist and firm-level, and the strength of each respective type has changed over time; whereas Neocorporatism has remained steady or declined, firm-level organization has become stronger in all countries. The literature underscores the differential effects of these two forms of business organization on employer support for active labor market policies and brings new evidence to bear on the implications of the relative shift towards firm-level organization on firms' investment in active measures. A macro-level study analyzes the differential effects of these two types of employer organization on total spending on active labor market policies in a pooled analysis of 18 countries between 1985 and 2000. A micro-level study explores the differing nature of firms' investment in active labor market policies in a context with strong Neocorporatist organization and weak firm-level organization (Denmark) and one with strong Neocorporatist and strong firm-level organization (Germany). Adapted from the source document.

Active labor market policies consist of a diverse set of policy tools with which to address joblessness and the degree to which governments invest in various policies as a response to rising unemployment varies widely. Fleshing out the determinants by policy type holds the promise of illuminating more clearly contestation over activation. To this end, this study analyzes the role of partisanship as well as welfare state regimes and the economy on spending patterns. We begin by detailing a theoretical framework for understanding variation in active labor market policies. Bonoli categorizes active labor market policies according to their market orientation and emphasis on human capital investment. In a study of social service reforms, Gingrich explains how all parties employ market-based reforms to empower some groups over others. These theories are then used to derive partisan hypotheses for direct job creation, training, labor market services, and employment incentives. Hypotheses for the four main types of active labor market policies are tested with regression analysis of 22 countries between 1985 and 2008. High spending on direct job creation, a non-market oriented policy type, is marginally significantly higher in the social democratic regime and by left governments prior to the activation turn. Left parties spend significantly more than other parties on training policies and after the activation turn these policies also become a distinct feature of the social democratic welfare state regime. The same trend exists for employment incentives. Center-right parties and those within the Christian democratic regime also spend marginally significantly higher on training policies before the activation turn, which is explained by results for deindustrialization. No partisan or regime effects are found for labor market services, which supports the view that all countries rely on these policies. The literature also suggests that a composite measure masks political conflict since this policy type encompasses diverse policies.

Despite the popularity of social investment, there remain ambiguities regarding how to design an effective social investment approach. We review evaluations of conditional cash transfers (CCTs) in Latin America in order to draw out lessons of how to improve the effectiveness of social investment. CCTs share many of the objectives of the social investment approach and are targeted at poorer groups. Since research shows that such groups are often not adequately supported through social investment policies, analyzing CCTs holds particular promise. Our analysis finds that architects of social investment policies should consider three questions when designing a social investment approach: how much investment is necessary to fulfill social investment functions, what is the causal mechanism through which the goals of social investment are to be achieved, and what array of policies are necessary for such mechanisms to be effective?