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Cover -- Half Title -- Title Page -- Copyright Page -- Table of Contents -- Preface -- Introduction and overview -- Part 1: Ethical concepts and principles -- 1.1 Altruism, efficiency and justice: ethical challenges to the welfare state -- 1.2 The ethics and the normgiving: the example of rehabilitation -- 1.3 Crossing frontiers: migration and social security -- 1.4 Alternative measures of national poverty: perspectives and assessment -- 1.5 The measurement of absolute poverty -- Part 2: Ethics and attitudes -- 2.1 Popularity and participation: social security reform in Australia -- 2.2 Coping with risk: attitudes towards private unemployment insurance in Britain and Germany -- Part 3: Ethics and the evaluation of concrete institutions -- 3.1 The pre-market phase: the transition from a state-controlled to a market-based social security system -- 3.2 Public programs create private incentives and disincentives toward work -- 3.3 Social security, intergovernmental fiscal relations and efficiency: the case of the two systems of public assistance for the unemployed in Germany -- 3.4 Skills, gender equality and the distributional impact of female labour market participation in the three worlds of welfare capitalism -- 3.5 What determines work resumption from long sickness spells? - an analysis of six countries -- 3.6 Demographic change and partial funding: is the Swedish pension reform a role model for Germany? -- List of contributors

Behavioral economics has shaken the view that individuals have well-defined, consistent and stable preferences. This raises a challenge for welfare economics, which takes as a key postulate that individual preferences should be respected. We agree with Bernheim (2009) and Bernheim and Rangel (2009) that behavioral economics is compatible with consistency of partial preferences and that subjective welfare measures do not offer an attractive way out of the impasse. However, their analysis which rests on traditional concepts like Pareto optimality and compensation tests, is not adequate to introduce distributional considerations. We explore how partial preferences can be introduced in the recent theory of welfare that has developed from the theory of fair allocation. We revisit the key results of that theory in a framework with partial preferences and show how one can derive partial orderings of individual and social situations.

Most studies using microsimulation techniques have considered the effect of potential reforms, but only regarding income distribution. However, it has become increasingly recognised, both at the academic and political level, that focusing purely on income provides a limited picture of social progress. We illustrate how ex-ante policy evaluation can be performed in terms of richer concepts of individual well-being, such as subjective life satisfaction and equivalent incomes. Our analysis makes use of EUROMOD, the EU-wide tax-benefit microsimulation model, along with 2013 EUSILC data for Sweden, which for the first time provides information on subjective wellbeing. Our results show that the effect of potential reforms varies widely depending on the well-being concept used in the evaluation. We discuss the normative questions that are raised by this finding.