Social security market across

Author: Wan Mingguo
Publisher:
Publish Date: 2005-08-01
Features: This book argues that under the conditions of an incomplete market economy, China's market constraints and institutional foundations for social security are in a primary stage by exploring the characteristics of a market economy and an incomplete market economy, as well as the different requirements of social security. It compares the differences in realizing the functions of social security between China and Western countries, draws on the experience of mature market economies in developed Western countries regarding the structure and functions of social security, and proposes basic ideas for constructing social security systems at different levels and types in China. · China's market constraints and institutional foundations for social security are still in the "primary stage"; · The basic approach to constructing social security under China's incomplete market economy conditions can only be a non-balanced, government-intervention-based development path; · The ideological foundation of China's social security system should be people-centered, involving joint participation, a combination of diversity and multiple layers, and achieving a balance of fairness, equity, and efficiency; · From the perspective of social security, the government must be a government that serves the entire population.
Chapter 1 introduces the characteristics of a market economy and its social risks, as well as the different requirements for social security under a market economy and an incomplete market economy. Modern social security first emerged in developed capitalist countries in Europe and America. This was a institutional innovation measure taken by capitalist governments, weighing the pros and cons, to introduce social security systems to repair the inherent flaws of the market economy system after the market economy entered a mature stage, in order to maintain a market economy order favorable to economic development. As a result, social security became an integral part of the market economy system. On one hand, the social risks caused by market failures drove the supply of social security; on the other hand, the establishment and improvement of social security better maintained the continuous evolution of the market economy system. The incomplete market economy and incomplete market theories discussed in this book are two fundamentally different concepts. Incomplete market economy is used in the context of mature market economies. In different stages of China's incomplete market economy, due to significant changes in economic and social structures, society will form different requirements for the social security system. As the incomplete market economy develops, China's social security system will also be a gradual process of structural adjustment and functional improvement.
Chapter 2 focuses on analyzing the institutional characteristics of different representative welfare models in contemporary Western countries and examines them from perspectives such as advantages, shortcomings, and reform trends to reveal the interactive development relationship between the institutional design, operation, and mature market economy conditions. According to the main summary of the market economy in modern economic theory, from the historical process and practical requirements of market economy development in countries such as Germany, the United States, and the United Kingdom, the experience of designing, formulating, adjusting, and establishing modern social security systems with distinctive characteristics can be drawn from their theoretical achievements in modern social security system construction based on their understanding and innovation of the market economy. This is particularly important in the process of deepening the socialist market economy system in China and building a harmonious society with a moderately prosperous society in the long term.
For modern market economies, the neoclassical synthesis theory remains the mainstream view guiding the construction of modern social security systems. The fulfillment of the government's social functions must be combined with the inherent requirements of the market economy system. This requires the government to intervene in market failures and shortcomings to achieve an optimal combination of efficiency and fairness, making the reallocation of resources a necessary supplement to the market allocation of resources. The government should fully leverage the efficiency of resource allocation through social security public goods and effective organization and management to enhance the competitiveness of the country in the process of economic integration. The basic role of the government in the construction of the modern social security system includes: first, establishing the legal system for the social security system through legislation; second, playing the socio-economic function of social security as a macroeconomic stability policy; third, playing the function of social security as a microeconomic mechanism to influence resource allocation and improve economic efficiency; and fourth, respecting public opinion, encouraging social participation, and establishing a reasonable mechanism for the overall allocation of social security resources. The government cannot and should not abandon its responsibility for providing public goods and pursuing a healthy economic environment.
Chapter 3 primarily explores the common characteristics of the structure and functions of social security in mature market economies in developed Western countries. The mature market economy model discussed in this book is based on market economy countries such as the United States, the United Kingdom, and Germany. It summarizes some aspects of the common characteristics of modern social security systems established in these countries, discusses the public expenditure theory of modern social security systems, and studies the latest reform and development trends of modern social security systems, aiming to reveal the internal connection between modern social security and mature market economy models.
From the perspective of expenditure sources, social security expenditures involve two different fields: public sector expenditures and private sector expenditures. In terms of economic development, the social security expenditures of the public sector are intrinsically linked to the productivity of the private sector. Improving the comprehensive welfare level of social security depends on increasing the proportion of expenditures in sectors that are more conducive to employment and resource utilization. Based on the experience of developed Western countries, the institutional support for the social security system under market economy conditions can be distinguished from two dimensions: one dimension is the level of the market economy institutional system, and the other dimension is the type of the market economy institutional system. From the perspective of the level of action, it can be divided into the construction of high-end organizational systems and low-end organizational systems in the market economy institutional system; from the perspective of the type of action, it can be divided into supporting systems for institutional composition and supporting systems for institutional operation. The hierarchical construction characteristics of the market economy system determine the development level of the market economy system itself, and at the same time determine the extent and nature of the implementation of the corresponding social security system, thereby determining the traditional and modern attributes of the social security system.
From the perspective of formal institutional composition, the market economy has different effects on the construction of social security systems. The constitutive supporting system forms the provisions for the constituent elements of the social security system, which is the basic principle for the establishment of the social security system, such as the subjective provisions of social security, the sources and management provisions of social security funds, the provisions for beneficiaries and benefit systems, etc. It mainly affects the structural characteristics of social security; the institutional operation supporting system determines the regulatory provisions of the social security system dependent on the operation of the market economy system, aiming to protect the behavior norms of various social security interest groups entering the market and to establish the basis for handling relationships, mainly relying on the stability of market operations. These two-dimensional observation perspectives construct the basic analytical framework for the interactive development of mature market economies and modern social security systems.
The key points of Chapter 4 are to list the status and problems of social security under incomplete market economy conditions. It can be seen that under China's incomplete market economy conditions, the level of service provided by the government for social security public goods lags significantly behind the requirements for risk response generated by the continuous deepening of the market economy system. The government's social security policies and system design are arbitrary and lack the basic principles of fairness, efficiency, and social solidarity that must be adhered to in the provision of public goods services and redistribution policies. This is also reflected in the structural design of social security public goods. The structural design can be analyzed from two aspects: the provision of social security to the population and the institutional structure of social security. The provision of social security to the population can be further examined from the perspective of urban-rural segmentation and the secondaryization of urban-rural areas. The social security issue of "migrant workers" is essentially a perspective for examining the secondaryization of urban social security. The structure of the social security system is clearly not comparable to the modern social security structure of mature market economy countries in the West. In China, areas such as education, labor employment, housing, and public health have not been systematically and consciously included in the social security system. Currently, it is only distinguished by projects such as social insurance, social welfare, and social relief.
Chapter 5 compares the actual differences in market constraints and institutional foundations for realizing the functions of social security between China and Western countries, arguing that China's social security under incomplete market economy conditions is indeed in the "primary stage." The institutional system closely related to the development level of the market economy, such as the government, enterprises, and third-party organizations, constitutes the necessary institutional environment for social security. The differences in the institutional environment and institutional foundations at different stages of market economy development determine the difficulty of replicating social security systems in different countries. The division of responsibilities between the government, enterprises, and individuals in the social security system is directly linked to the development level of the market economy, because different production methods determine the possible choices for distribution and redistribution. The extent to which social security enhances social welfare is constrained by specific economic and socio-cultural environmental factors, which also means that when borrowing foreign theory and practice, attention must be paid to the basic characteristics of the diversity of social security systems. The construction and reality of social security systems in mature market economy countries in the West and their socio-economic conditions have their unique value concepts, overall strategic thinking, and institutional design. A system, especially one like social security, must reflect the socio-cultural development of its own nation and country. When transplanted to other regions or countries, it may face constraints such as application conditions, cultural backgrounds, and institutional dependencies, and even merely technical constraints may lead to distortions or errors in system operation.
Chapter 6 proposes the basic ideas for constructing social security systems at different levels and types in China. From the perspective of policy choices, the construction of China's social security system should be based on the current national conditions, systematically understand the realistic foundation of social development, and propose appropriate and realistic social security basic concepts and institutional goals while accurately grasping the theory of modern social security systems and foreign practical experience. The ideological foundation of China's social security system should be to establish a people-centered value concept, implement a participatory social security construction, establish a government-led system with a combination of diversity and multiple layers, and strive to achieve a balance of fairness, equity, and efficiency in social security, fully leverage the comprehensive socio-economic functions of the social security system construction, promote the reform of the market economy system, and enhance social solidarity and social capital. The common participation of different social interest groups is an effective approach and basic guarantee for the construction of social security that meets the requirements of a moderately prosperous society. Only by participating can the wishes of vulnerable groups be expressed, and their interests can be guaranteed through institutional means. In this sense, the government must be a government for the entire people. Based on the basic judgment of the incomplete market economy, it is believed that the basic approach to constructing social security under China's incomplete market economy conditions can only be a non-balanced, government-intervention-based development path, forming an integrated system with multiple and multi-layered characteristics through the combination of basic, selective, and supplementary social security systems.