24th ESPANET Annual Conference

Resize? Restructure? The European Social Model under Pressure.

The European Social model, in its various fruitions, is facing significant pressures - both from within and from external sources.

The Dragi Report (European Commission, 2024) provides worrying evidence of the lack of dynamism of the European economy vis-a-vis its main economic competitors (US and China):

1. there is no EU company with a market capitalization over EUR 100 billion that has been set up from scratch in the last fifty years, compared with 6 in the US; 
2. EU companies are concentrated in mature technologies where the potential for structural innovation is limited and spend less on research and innovation (R&I) than their US counterparts, in 2021;
3. Between 2008 and 2021, close to 30% of the “unicorns” - startups that went on the be valued over USD 1 billion - founded in Europe relocated their headquarters abroad, with the vast majority moving to the US.

At the same time, as a result from the Invasion of Ukraine and the re-emergence of a scenario of great-power competition at the global level, there is an increase the pressure to increase military spending - and that has recently translated into the agreement of European NATO member-sates to raise defense spending and investment up to 35%.

The levels of public investment needed to tackle these challenges, as well as finance the Green Transition, put forward a significant fiscal challenge to EU member-states, in particular to those encumbered by high levels of public debt.

At the same time, the increased popularity of right-wing populist forces is reshaping the politics of the welfare state, both in terms of the composition of pro-welfare constituencies (Chueri, 2022), both in terms of the welfare agendas these parties pursue (Jessoula et al, 2022).

All these developments are likely to drive the debate on the European Social Model towards terrains that are reminiscent of the debates in the late 1980s /1990s about the size, extent and structure of European welfare states and about issues of deservingness and distributional fairness.

The 24^' ESPAnet Annual Conference aims to address these questions, exploring to what extent we need to change our analytical and methodological lenses to effectively tackle these challenges.