ECONOMICS, ECONOMISTS AND THE WELFARE-STA TE

Based on Jorgen Dich's economic-theoretic 1958-apology for the welfare state as representative for the thinking of Scandinavian economists o f the day the paper develops the reasons for the growing scepticism of the economic profession with respect to >>the social engineering appr oach<<. The reasons discussed are: 1. the experiences following from t he growth of the public sector in general and the development of trans fer payments in particular, 2. other ex post experiences not available ex ante and 3. the development of economic theory as influencing the economists' view of the world. The economist of today emphasizes that a balanced wiew of the welfare state should take proper account of its benefits and costs: the welfare state as the project has been replace d by a more pragmatic welfare policy.