- Volume 67 Issue 4
It is widely accepted that one of the main challenges of the 21st century welfare state is how to harmonize 'Old Welfare, Old Risks' which mostly consists of income maintenance programs with 'New Welfare, New Risks' which actively advances social services. It is in this regard that this paper attempts to define the relationship between the income maintenance programs and social services. For this purpose, it analyses social expenditure of 18 OECD countries during 1980-2006, and subsequently attests, if there is a trade-off relationship between the two, using correlation and Granger panel analysis. It duly concludes that the trade-off relationship between the two is not valid in that the two are better understood as a complementary relationship, not substitute relationship.