Privatisation and the Future of the

Swedish Welfare State

An Experimental Study on the Effects of Privatisation on the Swedish Middle Classes’

Support for the Welfare State

Oskar Pettersson

Uppsala University, Autumn 2018

Department of Government

Political Science C (Bachelor Thesis)

Supervisor: Anders Lindbom

Words: 12 839

Pages: 38

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Abstract

This paper investigates whether privatisation of welfare services increases the Swedish middle

classes’ support for the welfare state. This study is situated within an adaptation of the Paradox

of Redistribution, according to which privatisation may be a way of accommodating the interests

of an increasingly individualistic and autonomous middle class. The support of the middle classes

is thought to be crucial, as it provides the resources necessary to maintain a comprehensive

welfare state. A survey experiment is used in order to examine the causal link between specific

information stimuli regarding to what degree specific welfare services are provided by private

actors, and survey respondents’ personal willingness to pay taxes for specific welfare services.

The use of information stimuli follows from an assumption of ill-informed respondents. The

willingness to pay for specific welfare services serve as a micro-level indicator of welfare state

support, with a macro-level indicator serving as a complement. Key evidence is found in the

micro-level case of social services, and the overall results are taken to give support for the

hypothesis. The paper provides important insights into how Swedish policy makers could reason

with regards to the design of welfare services, if they are interested in securing the financing, and

in turn, the longevity of a comprehensive welfare state.

Keywords: privatisation, Swedish welfare state, welfare services, middle classes, Paradox of

Redistribution, survey experiment, information stimuli

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Table of Contents

1. Introduction ..................................................................................................................... 2

2. Theoretical Framework ................................................................................................... 4

2.1. The Paradox of Redistribution ......................................................................................................... 4

2.2. A Boundedly Rational and Ill-informed Citizenry ......................................................................... 6

2.3. Theoretical Argument and Hypothesis ............................................................................................ 7

3. Research Design ............................................................................................................ 12

3.1. Data and Case Selection ................................................................................................................... 13

3.2. Statistical Method .............................................................................................................................. 16

3.3. Dependent Variables ........................................................................................................................ 17

3.4. Independent Factors ........................................................................................................................ 17

4. Results and Analysis ...................................................................................................... 19

4.1. Willingness to Pay for Specific Welfare Services ......................................................................... 19

4.2. Preference for Social Democratic Welfare Policy ........................................................................ 30

4.3. Summary and Discussion ................................................................................................................ 31

5. Conclusions ................................................................................................................... 33

6. References ..................................................................................................................... 34

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1. Introduction

In the scientific literature on welfare states, it is well-established that the Swedish welfare state

has stood out as the one welfare state most resembling what Esping-Andersen (1990) termed

the ‘Social Democratic Welfare Regime’. It refers to a welfare state which emphasises universality

and social egalitarianism, and that “serves all citizens according to more generous, middle class

standards” (Lindbom, 2001, p. 174). However, there are reasons to suggest that the Swedish

welfare state of today no longer resembles the Swedish welfare state of the past, at least not fully.

Whereas welfare services have previously been almost exclusively publicly financed and provided

(Blomqvist, 2004), the provision of these various welfare services now involve both public and

private providers. This is not an insignificant development. As Blomqvist (2004) states, it

“represents a significant break with previous policies and their value basis” (p. 141), referring to

universalism, solidarity and social egalitarianism. It is, then, a moving away from centrally

planned, universal and standardised welfare services, to more consumer-oriented welfare services

– with the word ‘consumer’ very much indicating what this development is all about.

The issue of privatisation is very much related to the question regarding how the Swedish welfare

state is to be financed in the future – an important question considering the challenges that face

the Swedish welfare state, but also considering the global trend towards austerity politics and

welfare state retrenchment that has been apparent since the 1980’s (Pierson, 1995). Is

privatisation a threat the long-term survival of the welfare state, eroding the core values on which

it is based (Blomqvist, 2004; Lindbom 2001)? Or, is it something that could vitalise and

strengthen it?

In this paper, it is proposed that privatisation may be a way of accommodating the interests of

an increasingly individualistic and autonomous middle class, which is a way of maintaining their

support for the welfare state. This follows from an adaptation of Korpi & Palme’s (1998) Paradox

of Redistribution. The support of the middle classes is thought to be crucial, as it provides the

resources necessary to maintain a comprehensive welfare state. Privatisation efforts would in this

line of reasoning be a way to secure the support of the middle classes, and thus ensure a stable

financing of the welfare state in the long run.

To determine whether there is merit to this argument, this paper uses a survey experiment to

test the causal effects of information stimuli regarding the degree of privatisation within Swedish

welfare services, on the middle classes’ support for the Swedish welfare state. This support is

measured using both micro- and macro-level indicators. Key evidence is found in the micro-

level case of social services, and the overall results are taken to give support for the hypothesis.

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This suggests that there are reasons to believe that privatisation could be a means of securing

the support of the middle classes, whose support then is thought to be crucial to the longevity

of a comprehensive welfare state.

This paper provides a contribution in the way that it uses a survey experiment to establish the

causal relationship between information stimuli and political preferences, specifically related to

welfare state support. While there is the inevitable issue of low generalisability based on survey

experiments, the causal evidence that is found should still be relevant to the phenomena that are

discussed. Furthermore, the importance of information and knowledge should not be

understated, and this paper adds to the literature that conveys this notion. The paper also

provides an innovative theoretical contribution in that it extends Korpi & Palme’s (1998) Paradox

of Redistribution to the domain of welfare services and privatisation, as to explore the important

question of what privatisation could mean for the prospects of financing the Swedish welfare

state.

2. Theoretical Framework

This section provides the framework that ties theory and previous research together with the

hypothesis and the concrete analyses that are to be carried out. First, Korpi & Palme’s (1998)

Paradox of Redistribution is put forward and explained. Second, key assumptions related to it are

examined and revised. Third, the paper’s theoretical argument, hypothesis and approach are put

forward. Key definitions are made along the way.

2.1. The Paradox of Redistribution

In a seminal and influential article, Korpi & Palme (1998) ask an important question regarding

social insurance systems: “Should they be organized for the poor only or should the welfare state

include all citizens?” (p. 661). If one is concerned with designing these systems and the welfare

state as to reduce inequality, the answer may seem easy. Because, surely, shouldn’t it be the case

that a welfare state that specifically aims at helping the poor will be the most effective at doing

exactly that? On the contrary, as Korpi & Palme show, there are reasons to believe that the

inclusion of the middle classes into the welfare system may in fact be crucial to the long-term

survival of a comprehensive welfare state.

Through a comparison of different welfare states, categorised in line with Esping-Andersen’s

(1990) typology of welfare regimes, they find that Liberal and Conservative welfare states are

more prone to adopt so-called low-income-targeted social insurance systems, whereas the Social

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Democratic welfare states tend to have more universal and encompassing systems, thus including

the middle classes. Through this comparison, they find Social Democratic welfare states to be

best at reducing inequality. But, how come? To summarise the argument, one may say that

targeting social insurances, that are meant for the poor only – i.e. the systems common in Liberal

and/or Conservative welfare states – give the middle classes no reason, no rational incentive, to

support the financing of such systems. Implicit in this argument is that the rich are assumed to

be unconditionally against the systems, whereas the poor are assumed to be for them.

The middle classes’ support, however, is conditional. They are open to supporting these systems

if they provide them with benefits. If they do, there is a foundation for a “pro-welfare coalition”

(Lindbom, 2011, p. 175) between the middle classes and the poor. If they do not, the interests

of the middle classes and the poor simply will not be aligned. This, then, apart from essentially

being an argument from public choice, is an argument that stresses the importance of welfare

state institutions when it comes to predicting the support that a comprehensive welfare state

may or may not enjoy.

Looking at the different welfare states, this middle class-behaviour in relation to the social

insurances, effectively translates into a trade-off between the degree of low-income targeting that

a welfare state has in its social insurances, and the size of the budget available for that state to

redistribute (Korpi & Palme, 1998, p. 672). The more universal social insurance systems, the

more reason for the middle classes to support those systems, and hence a wider financial support

for said systems. So, while it may seem or feel ‘right’ to focus welfare efforts exclusively on those

that need it the most, Korpi & Palme’s study suggests that accommodating the interests of the

middle classes is in fact crucial if one’s primary goal is to help those at the bottom, and to reduce

inequality. As they state:

“[…] providing sufficiently high benefits for high-income groups so as not

to push them to exit, in encompassing institutions the voice of the better

off citizens helps not only themselves but low-income groups as well”

(p. 672).

To ‘exit’ is here to acknowledge that one does not receive any benefit from the systems, and

therefore redirect one’s support away from the welfare state. Korpi & Palme’s argument is then

formalised in the Paradox of Redistribution:

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“The more we target benefits at the poor and the more concerned we are

with creating equality via equal public transfers to all, the less likely we are

to reduce poverty and inequality” (p. 661).

To illustrate with an easy example, one may examine the Swedish child benefit (Barnbidrag). If

the benefit was targeted exclusively at parents with low incomes, one would expect the support

for the benefit to be weak among the middle classes. But, since the Swedish child benefit is

universal and includes parents with higher incomes, it can enjoy a wider base of support than if

it had been targeting. This example illustrates the logic that Korpi & Palme proposes: the needs

of the middle classes need to be accommodated if to maintain extensive support for a

comprehensive welfare state that aims at reducing inequality. Certainly, the systems will provide

benefits for those that may not really need it the most, but since it results in an increase of the

redistributive budget, those that do need it the most will become better off as a consequence.

2.2. A Boundedly Rational and Ill-informed Citizenry

Judging from the Paradox of Redistribution, it is clear what the middle classes want – they want to

get something out of the systems. Otherwise, there is no rational incentive for them to support

them. These assumptions are public choice-oriented, and there are important aspects of these

assumptions that can be called into question. It is not so much about the assumptions of self-

interest that is of concern here, but rather that it seems to follow that the middle classes are

capable of reacting decisively to the way that social insurances are designed, and to change their

political preferences thereafter. In other words, they thought to be responsive (Wlezien, 1995;

Jennings, 2009). Furthermore, this builds upon the assumption that they are well-informed. After

all, how could they otherwise be responsive? The kind of citizenry that is suggested is essentially

one that is enlightened, to borrow from Dahl (1989).

It should not be controversial to object to this notion. As put by Rapeli (2014), and as is echoed

in Somin (1998), “The mainstream of several decades of empirical research has declared that

most citizens are politically ignorant” (p. 428). This is mainly pointing to accounts made in the

American context (Bartels, 1996; Althaus, 1998; Gilens, 2001). But it has been made clear that

this also applies to the Swedish citizenry (Lindbom, 2011). Based on this notion, a revised

assumption going forward is that the Swedish citizenry, including the middle classes, is not at all

as well-informed as the citizenry implied by Korpi & Palme (1998). This is, in effect,

acknowledging that ‘politics’ is in reality a very complex phenomenon that demands high levels

of knowledge and understanding from the citizenry – something that cannot be expected if one

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instead treats the citizenry as boundedly rational, a citizenry that acts upon limited information and

with limited cognitive abilities (Simon, 1955). It is important to put forward this revised

assumption at this point since it forms the basis for the approach that will be taken in order to

test the coming hypothesis.

2.3. Theoretical Argument and Hypothesis

The aim is now to continue beyond social insurances and child benefits, and to apply the Paradox

of Redistribution to Swedish welfare services. This is in fact suggested by Korpi & Palme (1998, p.

666), but is not taken further. Here, then, welfare services refer to the various services that are

often attended to by the public sector in some regard, i.e. health care, education, day care for

children, elder care and social services (Blomqvist, 2004). Following Korpi & Palme (1998), and

Lindbom (2018), it should be reasonable to suggest that the support for these welfare services –

and in turn, the welfare state – will depend on whether they succeed at accommodating the

interests of the middle classes.

How does one, then, accommodate middle class-interests regarding welfare services? In Sweden

historically, a very important aspect has been the overall quality of the welfare services. As the

late Social Democratic politician Gustav Möller (1884-1970) said: “Only the best is good enough

for the people” (in Rothstein, 2010, p. 246; author’s translation). This points to the fact that it

was crucial that the welfare services maintained a high level of quality so that the middle classes

would not look around for alternatives that were more in keeping with their standards.

Remember that the Swedish welfare services were strictly universal and standardised. It was

predicted, and rightly so, that there would be no way of maintaining the support of the middle

classes if these services were of a questionable quality. Hence, the “high-qualitative standardized

solution” (ibid.; author’s translation) was heavily pursued.

In current times, however, there are indications that Swedish citizens’ support for universal and

standardised welfare services has diminished considerably. A very important factor to consider

is the trend towards a much more individualistic citizenry, with increasing demands regarding

personal autonomy in relation to the state (SOU 1990:44). This trend has been distinguishable

for some time, and there are no good reasons to suspect that it has not continued. Individualism

on the part of the citizenry, as put by Thorleif Pettersson (1992), involves the prioritising of the

citizen’s own “self-fulfillment and well-being” (p. 51), at the cost of societal or collective duties.

Crucially, this development has been strongest among the well-educated middle classes

(Rothstein, 2010). This should put pressure on politicians to design the welfare services as to

accommodate the growingly individualistic needs of the middle classes, at least if they’re willing

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to take Korpi & Palme’s reasoning to heart. Accommodating the middle classes’ individualistic

needs will then be crucial in order to maintain the budget necessary to finance the welfare

services. These services are, in turn, important as a safety net for those that are less well-off and

that do not have the resources to turn away from them.

As stated in the beginning of this paper, the Swedish welfare state has seen a development

towards privatisation, bringing competitive private actors into the ‘business’ of providing welfare

services such as health care, education, social services and elder care. At this point, a clear

definition is in order. The type of privatisation that is being referred to here, is one that is usually

known in the public administration literature as “functional privatisation”, “contracting out” or

“purchaser-provider split” (Kuhlmann & Wollmann, 2014, p. 189f). Essentially, the public sector

purchases the provision of the services from private actors, using public financing. Hence, the

kind of privatisation that is being discussed here is not one where the public sector sells off

public resources completely, and where private actors assume full responsibility for the

financing, organising and provision of the welfare services. If that was the case, it would be

difficult to discuss middle class support for the welfare state. In this case, then, the financing of

welfare services still resides with the public sector – an important indicator of a yet present and

active welfare state.

An important aspect that has accompanied this form of privatisation is the notion of free choice

of welfare service providers. If a public provider of a certain service is dissatisfactory, the citizen

can switch to a private alternative – there is the possibility to ‘exit’. For an individualistic citizen,

this ability to exit from the publicly provided welfare services may be seen as something that

makes him or her more autonomous (Le Grand, 2007) and empowered (Sörensen, 1997; Solevid,

2009; Bendz, 2017). Empowerment points essentially to a change in “the power balance between

the state and the individual citizens. The higher the degrees of influence over one’s life

circumstances, the higher the degree of empowerment” (Bendz, 2017). Surely, to be able to

choose a private alternative over a public one should be empowering to an individualistic citizen.

So, privatisation together with the empowerment that comes from free choice, should be viewed

as an important way of accommodating the individualistic preferences of the middle classes.

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Hypothesis

Following the theories, assumptions and the argument that has been laid out, a main hypothesis

can be put forward, namely that

Privatisation of welfare services increases the middle classes’ support for the welfare

state.

It is appropriate to describe the approach to testing this hypothesis right away. Having assumed

an ill-informed and boundedly rational citizenry, there is an opening for the use of specific

information in order to test for this causal increase. One example of the use of specific

information is provided by Gilens (2001), who shows that specific information can indeed affect

political preferences, and that there can be a distinct difference between the preferences of those

that become well-informed and those that do not. These results are in line with previous

American studies, i.e. Althaus (1998). They are also echoed in the Swedish context by Lindbom

& Ahlskog (2017), who show the effects of specific information on attitudes towards the

Swedish unemployment benefit scheme (A-kassa). To test whether the hypothesis holds true, it

will be examined whether the willingness of the middle classes to pay taxes for specific welfare

services increase, as a causal effect of them becoming more well-informed as to what degree specific

welfares service are provided by private actors – as opposed to public ones.

The willingness to pay taxes for specific welfare services will be used as a micro-level indicator

of welfare state support, which should be reasonable considering that it is through using specific

services that one experiences the welfare state (Kumlin, 2004; Solevid, 2009). Furthermore, a

macro-level indicator will be included in the analyses: the preference for Social Democratic

welfare policy. The idea is that the middle classes may be more inclined to accept the

comprehensive and expensive welfare state policy associated with Social democracy if they learn

of the progress towards privatisation within welfare services. The micro-level indicator should

more accurate than the macro-level indicator, though, since it should be based to a higher degree

on concrete, real-life experience, whereas that of Social Democratic welfare policy may be more

ambiguous and ideologized. Hence, the micro-level indicator will be the main focus of the

analysis. But in case that no support can be found, the macro-level indicator may serve as a last

resort. This study should be seen as exploratory and theory-developing. The goal is to see

whether there is any merit at all to the theoretical argument that has been put forward. Hence,

any support that can be found for the hypothesis, especially on the micro-level, will be given

considerable weight.

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The subject of this paper begs the question of “Who are the middle classes?”. The answer to

that question is that there isn’t really one single correct way of defining middle class, or to

measure it. From personal communication it seems that Korpi & Palme (1998) are thinking of

vocation when they define middle class, but it should be equally reasonable, if not more, to look

at it in terms of income. Fresh research has shown income to be an advantageous indicator in

cases adjacent to that of this paper (Lindbom & Ahlskog, 2017), so it should be reasonable to

continue in that vein.

The Swedish median salary in 2017 was 33 000 SEK, per month before tax (SCB). Using this

median salary as a point of reference, it is possible to establish a reasonably narrow interval,

within which one can be said to belong to the middle classes – in the Swedish context. In this

case, the interval 26 000–37 000 SEK should be reasonable. Using income in this manner, and

specifying this one interval, is not a clear given, however. One issue is that one is bound to

include citizens with salaries within the interval that may still not ‘count’ as middle class. A good

example is well-paid industrial workers, workers who may perhaps not share the same interests

as, say, well-educated academics. Hence, using income does involve some potential validity issues

that could perhaps be avoided by using another measure. But it may also be the case that these

blue-collars have also been affected by the individualistic development, so to speak. Considering

this, it should be made clear that while income will be used in this study, the issue is very much

still open for discussion. Moving forward, then, there is now a key middle class-income interval

to focus on in the coming analyses.

The main hypothesis is set, the approach has been explained, and a definition of middle class

has been made. Lastly, it is necessary to add a set of conditions to the hypothesis. The first

condition is access to high-qualitative welfare services. The importance of quality has already

been made clear, and the idea is that it is unlikely that the middle classes increase their willingness

to pay as a result of becoming more well-informed as to what degree a specific welfare service is

provided by private actors, if they are already satisfied with their access to high-qualitative welfare

services. In other words, the increase in willingness to pay should be apparent among those

belonging to the middle class that have a low access to high-qualitative services. The condition

may be formalised as:

1) The middle classes increase their willingness to pay if they have a low

access to high-qualitative welfare services.

If it was to be found that the middle classes with low access do in fact increase their willingness

to pay for a specific welfare service, it also needs to be determined that it comes about for the

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right reasons. In other words, it needs to be shown that it is indeed the individualistic preferences

that are behind the increase. A rival mechanism would be that the middle classes react with an

increased willingness to pay because they perceive privatisation as a negative development, and

a threat to the public sector. In that case, it would be very hard to argue in favour of the

hypothesis.

To this end, the analyses will incorporate the factors of preference for free choice of service

provider, and ideology. This is really to test that the individualistic mechanism behind the

hypothesis holds. Ideology, as measured on the left-right scale, has been proven to be strongly

correlated to preferences on privatisation in the Swedish case (Bendz, 2015), and preference for

free choice should be an indicator that is even closer to privatisation preferences. The reason for

using two indicators is that there is one ‘technical’ problem associated with the use of free choice,

namely that the variable that is used to measure it may be affected by the experiment, just like

the willingness to pay. Ideology, on the other hand, should be a factor that is less affected. It is

therefore appropriate to use both indicators, and thereby achieve a higher certainty regarding

whether the mechanism holds or not. So, having high preferences for free choice, and/or

identifying as right-wing, should then be sufficient indicators of individualistic preferences. This

second condition may be formalised as:

2) The middle classes with low access that increase their willingness to

pay, do so because of their individualistic preferences.

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3. Research Design

In this section, the point is to put forward and discuss the paper’s experimental design together

with the data and the method that will be used to test the hypothesis. Advantages and limitations

will be key subjects here. Information and explanations of key variables are also provided.

This paper uses the design of a survey experiment, which involves a “deliberate manipulation of

the form or placement of items in a survey instrument, for purposes of inferring how public

opinion works in the real world” (Gaines et al., 2007, p. 3; see also Sniderman & Grob, 1996).

This elegant description points to the issues that confront the researcher that wishes to prove

causal relationships based on regular surveys. Whereas a regular survey demands a rigorous

framework in order to isolate the effects of key independent variables while still being vulnerable

to the effects of confounding variables, a survey experiment allows for a direct analysis of

isolated and causal effects (Druckman et al., 2006).

It is worthwhile to explain this experimental logic thoroughly, and some important points will

be made in the data-section as well. The cornerstone, apart from the manipulation, is the random

assignment (or randomisation) of participants into a control group and one or more treatment

groups. The point of randomising is not to make the groups into exact mirrors of each other,

but to make sure that the groups that are analysed do not differ systematically from each other

on average, on traits and characteristics that could bias the results (McDermott, 2004). If an

adequate randomisation is achieved, the researcher may assume that the effects of the

manipulation – be it some piece of information, the ordering of survey questions or other types

of interventions – may be solely attributed to said manipulation.

At this point, hopefully, the reasoning behind the experimental design is quite straight-forward.

But, is it safe to assume that the randomisation has been successful? After all, the main reason

for using an experimental design depends on it. This concern may bring about a need of so-

called randomisation checks, with the purpose of establishing whether a randomisation process

has indeed been successful. If a randomisation check would indicate that the analysed groups do

in fact differ systematically on some relevant trait, such as sex or other demographic variables,

the conclusion would be that the randomisation process failed in some regard, and that

controlling for key demographic variables is warranted. Because, a failed randomisation would

impair the quality of the experimental conditions, and thereby also impair the credibility of the

results.

However, as argued by Mutz & Pemantle (2011), there are in fact good reasons to question the

need for randomisation checks. The concern is that the perceived need for randomisation checks

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builds upon an incorrect understanding of what a randomisation is supposed to accomplish: “A

well-executed random assignment to experimental conditions does not promise to make

experimental groups equal on all possible dimensions or on any one characteristic […]” (p. 5).

Following this idea, it is unfounded to proceed with randomisation checks and controlling, since

one has then in effect discarded the idea behind randomisation. Drawing on this argument, an

assumption going forward is that the randomisation associated with the data that is used in the

analyses will have been adequate. There is at least no sufficient reason to pursue elaborate

randomisation checks and the controlling for demographic variables.

To summarize this discussion, one may point to Teorell & Svensson’s (2007) four criteria of

causality: (1) counterfactual difference, (2) order, (3) isolation and (4) causal mechanism (p. 64).

Owing to the randomisation and manipulation on the part of the researcher, the experiment

excels at fulfilling the three first of these criteria. This is to say that it excels at proving that X

does indeed cause Y. Regarding the causal mechanism, it is a criterium best satisfied by the

researcher’s own argument (ibid. p. 77). The main strength associated with the experimental

design, then, is the ability to clearly distinguish the isolated effect of an independent variable,

and this makes it a powerful tool for the researcher wishing to provide rigid evidence of causal

relations (Esaiasson et al., 2012, ch. 19).

There are, of course, some general limitations to the experimental design that must be brought

up. A main issue is that it isn’t always clear what the results mean to real world phenomena, even

though one may be able to point to a clear and isolated causal relationship between variables. It

is, then, an issue regarding external validity. The challenge lies in arguing that the results really

are relevant to the real world, since this is probably not going to be apparent just by looking at

the results. In other words, the prospects of achieving high internal validity are high, but the

risks are high that the external validity suffers – a risk which accompanies experimental designs

in general, and this specific study as well. This issue will be discussed further in the last section.

3.1. Data and Case Selection

The data sample that will be used in the analyses comes from the Citizen Panel, which is run by

the Laboratory of Opinion Research (LORE) at the University of Gothenburg. It was ordered

by Anders Lindbom at the Institute for Housing and Urban Research (IBF), as part of the

research project The Legitimacy of the Welfare State. In the sample used in this paper, collected 2017

between April 20th and May 15th, a total of 4955 respondents have been asked about their

attitudes towards different welfare services and the Swedish welfare state more generally

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(Martinsson et al., 2017). Regarding the experimental design, the respondents were divided into

five different groups: one control group and four treatment groups. The four treatment groups

receive different types of information stimuli together with certain survey questions. In the

‘privatisation group’, respondents are treated with information regarding to what degree specific

welfare services are provided by private actors, and how this development has progressed during

the last twenty years. For example:

”Among those living in nursing homes, the share of people living in

privately operated nursing homes has increased from about 12 per cent in

the year 2001 to about 20 per cent in the year 2015.” ”

”The share of people with disabilities that live in a privately operated care

home has been constant during the years 2007 to 2015, at a level of around

25 per cent.”

(Author’s translation)

The analyses will only use the respondents in the control group and the privatisation treatment

group. Furthermore, they will only use respondents that are full-time employed. This causes a

drop in the number of respondents available for statistical analysis, but keeping all respondents

in – including the unemployed, students, pensioners and so on – would also cause problems.

When the subject regards support for the welfare state, it is appropriate to examine a set of

comparable respondents that are net financers of the welfare state. So, whereas the initial number

of respondents was 4955, the number comes down to a total of 883. This also brings up the

important question of case selection: which welfare services should be used in order to test the

hypothesis?

One can point to four main areas of Swedish welfare responsibilities: education, health care,

social services and elder care – all of which are included in the data, and they should all serve as

important micro-level indicators of welfare state support. However, preliminary tests suggest

that that the first two are ill-suited for this study. Essentially, the information stimuli do not seem

to have any notable effects. One potential explanation for this is that the usage of health care and

education is much higher than it is for elder care and social services – at least judging from the

sample. This may indicate that knowledge regarding these two services are quite high. There do,

however, seem to be some effects when examining the services elder care and social services,

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and there is then the opening for using specific information in the way that has been discussed

earlier. Hence, elder care and social services will be used as specific welfare services to test the

hypothesis. Considering this case selection, the information stimuli that were put forward earlier

will be of key importance.

There are some other important limitations to this data. Importantly, the respondents in the

sample are self-selected. This means that the usage of this data-set suffers some limitations

regarding the possibilities of generalising to a larger population (in this case the Swedish, full-

time working citizenry). In the same way that students are often overrepresented in experiments

conducted at universities, with their specific values and opinions, one may expect the

respondents in this data-set to possess certain traits and characteristics that make them

unrepresentative. Looking at the self-selected respondents in the data-set, it can be noted that

they are generally very interested in politics: 35,5 per cent of the respondents declared themselves

“very interested in politics” and 52,3 per cent declared themselves “interested in politics”.

Although ‘politics’ can have different meanings, it should capture an important characteristic.

Another characteristic is that of education; 44,8 per cent of the respondents declared themselves

as having attended university.

The fact that the self-selected sample is biased in these ways shouldn’t be surprising. Time is a

scarcity after all, and if anyone would willingly devote time and effort to aid political scientists

with their political attitudes and preferences, it would probably be those that are both well-

educated and interested in politics. So, even though effects are expected in the cases of elder

care and social services, one should not expect marked or significant effects. In light of this, it

should be reasonable to accept the higher risk that accompanies a 10 per cent significance level,

and even to make some generous interpretations of insignificant results – something that is

otherwise, strictly speaking, out of the question.

Another complicating factor is that the information stimuli accompany questions early in the

survey, and there is therefore a chance that effects on questions late in the survey will be severely

diminished. This is one negative aspect of so-called “one-shot stimuli” (Gaines et al., 2007),

which points to the risk that effects ‘wear off’ during a survey. This is especially relevant to the

macro-level indicator, support for Social Democratic welfare policy. The question used to

measure comes very far down in the survey and is therefore probably less affected by the stimuli.

This needs to be considered when the results are interpreted.

16

3.2. Statistical Method

The specific method that will be used to test the hypothesis is the statistical technique of

ANOVA, which is short for ‘Analysis of Variance’. The ANOVA, which is commonly used in

different experimental studies, is used to compare groups on possible differences in the mean of

a dependent variable that is measured on an interval or ratio scale (Klugkist, 2008). Thus, the

ANOVA allows for direct comparisons of means between different groups, and it tests whether

the means are significantly different. In ANOVA-terminology, the independent variables are

called factors, and these factors are used to put respondents into the groups whose means are to

be tested. One main advantage associated with using this method is that one can use multiple

factors and test the differences in means between more than two groups, all at once, without

accepting a higher risk of making a type I-error, i.e. to wrongly dismiss the null-hypothesis

(Teorell & Svensson, 2007, p. 140; Klugkist, 2008).

It may be noted that this method is not much different from a linear regression, and they can

both be used to achieve the same results. The ANOVA, however, should be a good choice in

this case, since it is the difference in means that are of main interest. As with linear regression,

the ANOVA can be used to look at so-called interaction effects. An interaction effect can be defined

as “the simultaneous effect of two or more independent variables on at least one dependent

variable in which their joint effect is significantly greater (or significantly less) than the sum of

the parts” (Kasim, 2008, p. 2).

Examining interaction effects becomes relevant when one believes that the effect of an

independent factor on a dependent variable could differ across the levels of another independent

factor, and the coming analyses are in fact looking into the effects of the information stimuli on

different levels of income. In the coming analysis, the ANOVA will in essence be used to

combine independent factors into interaction models – the results from which will be shown in

pairwise comparisons, based on estimated marginal means. From these pairwise comparisons,

one will be able to distinguish the experiment’s effects within different income categories for

example, which is of crucial importance to the hypothesis.

17

3.3. Dependent Variables

Willingness to pay: Elder care and social services

These variables, then, are used as micro-level indicators of welfare state support. They measure

a respondent’s personal willingness to pay taxes for the specific welfare services of elder care

and social services respectively. The specific survey question that is asked is: “Would you like to

pay less municipal taxes and give less resources to the elder care/social services? Or, would you

rather pay more taxes, and give more public resources to the elder care/social services?” The

variables have 9 levels, ranging from an extreme tax-lowering preference (1) to an extreme tax-

increasing preference (9), with the preference for status quo in the middle (5).

The ANOVA-method requires dependent variables that are measured on an interval scale, and

this isn’t strictly the case when it comes to these variables, which are measured on an ordinal

scale. However, as is often done by researchers, ordinal variables can be approximated as being

measured on an interval scale if they have enough levels (Teorell & Svensson, p. 109f). This

approximation seems reasonable to perform in these cases, and with regards to the macro-

indicator as well.

Preference for Social Democratic welfare policy

This variable, then, is used as a macro-level indicator of welfare state support. The following

survey question was asked: “What do you think about the following two parties’ welfare

policies?” The respondents then rank their preference for Social Democratic welfare policy on

the one hand, and Moderate, centre-right welfare policy on the other. This variable also has 9

levels, ranging from a very low preference (1) to a very high preference (9), with an indifferent

position in the middle (5). Since it is support for the welfare state that is being investigated, it

seems reasonable to only look at the Social Democratic welfare policy.

3.4. Independent Factors

Income

Income, then, will be used to measure middle class belonging. The income variable is measured

in 13 categories, but as was stated earlier, it was decided that the analyses will only use

respondents that have full-time jobs. As a direct consequence of this, the number of respondents

in the five lowest income categories becomes so small that they cannot be used in the statistical

analysis. Hence the analysis uses the eight remaining categories, measured in SEK per month,

18

before tax: 19 000–22 999, 23 000–25 999, 26 000–29 999, 30 000–36 999, 37 000–44 999,

45 000–54 999, 55 000–64 999, and ≥ 65 000.

Access to high-qualitative welfare services

The first condition to be added in order to test the hypothesis was the access to high-qualitative

welfare services. The survey question that was asked is: “To what degree, in your opinion, is the

public sector able to provide you and your relatives with good elder care/social services if you

would need it?” (Author’s translation). The factor has 9 levels, ranging from a very low degree

(1) to a very high degree (9), with the indifferent position in the middle (5).

Preference for free choice

The second condition is the preference for free choice when it comes to the provider of a specific

service, i.e. elder care or social services. The survey question that was asked, in the case of social

services, is: “What is your opinion on either increasing or decreasing the opportunities for the

service users to choose a private care home?” (Author’s translation). The factor ranges from a

strong preference for a decrease (1) to a strong preference for an increase (9), with the indifferent

position in the middle (5).

Ideology

Ideology is measured by the respondents’ own, subjective position on the scale of left and right.

The factor has 9 levels, ranging from the far-left (1) to the far-right (9), with the centre-

perspective in the middle (5). While some may argue that the left-right scale has become obsolete,

it should be reasonable to use in this case. After all, preferences regarding privatisation and

welfare issues ought to reflect the traditional left-right cleavage that has characterised Swedish

politics a long time.

19

4. Results and Analysis

In this section, the results will be presented together with an analysis of how they may be

interpreted in relation to the hypothesis. First, the effects of the experiment on the willingness

to pay for elder care and social services are examined. Depending on the initial results, the two

conditions are added to the analysis. When this is done, the effects on the preference for Social

Democratic welfare policy will be examined. To support the hypothesis, then, it needs to first be

shown that respondents earning 26 000–37 000 SEK react with an increased willingness to pay

for elder care or social services on the one hand, or with an increased support for Social

Democratic welfare policy on the other. This would give an initial support for the hypothesis

both on a micro and macro level. Then, it needs to be shown that the increases in willingness to

pay are present among the middle class-respondents with a low access to high-qualitative welfare

services. This would give a further indication that the hypothesis holds true. If this is indeed the

case, it must, lastly, be determined that the reactions are in fact a result of individualistic

preferences – as measured by free choice and/or ideology. If all this can be shown, the

hypothesis may be given support.

4.1. Willingness to Pay for Specific Welfare Services

Elder care

The analysis starts off by looking at an overview of the survey experiment’s effects in the case

of elder care. It is reasonable to get a good look at the data and see if there are any clear patterns

that can be distinguished, so all available income categories are included. In statistical terms, this

analysis shows the results of a two-way interaction model, the first of many, with the information

stimuli and income as independent factors.

20

Table 1: Effects of information stimuli on the willingness to pay for elder care.

*: p<0,1 **: p<0,05 ***: p<0,01. Standard errors of differences in parentheses.

The first column is income, and it sorts the respondents into their respective income categories.

The respondents are 880 in total, and the second column shows the number of respondents in

the control group and treatment group respectively, for each income category. For example,

there are 13 control group respondents and 18 treatment group respondents in the lowest

income category. Then follow the mean ‘scores’ regarding the willingness to pay for elder care

in the treatment group and the control group, with a high mean indicating a high willingness to

pay. If one looks at the control group, the means range from 4,59 to 6,50, indicating the various

preferences for paying in the different income categories. However, it is the differences between

the control group and the treatment group (T-C) that are of key importance. They are shown in

the fifth column, with their standard errors reported in the parentheses. The asterisks indicate

whether these differences in means are statistically significant on either 0,1, 0,05 or 0,01 levels

of significance. Since even the 0,1 level is taken to suffice, any asterisk indicates that the means

are significantly different from each other. The exact levels of significance for each difference

are shown in the sixth column.

Judging from Table 1, only one significant difference between control group and treatment

group means can be found. This is within income group eight, in other words among the

respondents that earn 26 000–29 999 SEK. These respondents increase their willingness to pay

for elder care by an average of 0,51, as a direct and causal effect of the information stimuli. This

increase may be put in relation to the scale on which the variable is measured, an ordinal scale

ranging from one to nine. It gives a clear indication of an increased willingness to pay for elder

Income (SEK) N (=880) Treatment Group Mean

Control Group Mean

Difference (T-C)

Significance Level

19 000–22 999 13/18 6,50 6,08 0,42 (0,63) 0,50

23 000–25 999 31/31 6,71 6,23 0,48 (0,44) 0,27

26 000–29 999 71/84 6,68 6,17 0,51* (0,28) 0,07

30 000–36 999 131/123 6,13 6,08 0,05 (0,22) 0,83

37 000–44 999 91/93 6,19 5,95 0,25 (0,25) 0,33

45 000–54 999 63/49 5,90 6,00 -0,10 (0,33) 0,76

55 000–64 999 20/22 5,73 5,86 -0,12 (0,53) 0,82

≥ 65 000 18/22 4,59 5,33 -0,74 (0,55) 0,18

21

care. No other differences turn out to be significant, but there are still some tendencies that may

be noted.

For example, there are similar increases in willingness to pay among respondents in the lowest

income categories, between 19 000 and 25 999. There are tendencies towards a decreased

willingness to pay among respondents with the highest incomes. Strictly speaking, of course,

these differences in means cannot be interpreted since they are not significant. Importantly, there

is only barely a tendency towards an increase in willingness to pay among respondents earning

30 000–36 999, which is problematic with regards to the hypothesis. Indeed, a significant

increase is present in the lower span of the interval of interest (26 000–36 999), but since this

does not hold for the entire interval, there are reasons to doubt that the hypothesis can find

support in the case of elder care. A graphical illustration of these patterns is provided below in

Figure 1, which should serve as an overview of the data being examined.

Figure 1. Effects of information stimuli on the willingness to pay for elder care.

One way of summarising the results for the respondents that make up the key interval (26 000–

36 999) is to combine them into one group. This provides the statistical analysis with a greater

number of respondents, and it should provide a clearer result as to whether there is any hope of

finding initial support for the hypothesis in the case of elder care.

22

Table 2: Effects of information stimuli on the willingness to pay for elder care. Income category: 26 000–36 999

SEK.

*: p<0,1 **: p<0,05 ***: p<0,01. Standard errors of differences in parentheses.

Doing this, the results show no significant increase in willingness to pay for elder care, when all

respondents that make up the income interval 26 000–36 999 are included in the same analysis.

This further substantiates the previous findings, which gave reason to doubt the positive effects

of the information stimuli on the respondents that have been defined as belonging to the middle

class. So, it seems that there is not anything substantial here that can support the hypothesis. The

information stimuli, which are supposed to appeal to the individualistic preferences of the middle

classes, seemingly does not cause an increase in the willingness to pay for the specific service

elder care. Even though there is doubt at this point, the factor of access will still be added later

on, in order to further the test of the hypothesis in the case of elder care.

Social services

The previous, initial analysis for elder care did not provide any substantial support for the

hypothesis. The task is now to see whether there is any support to be found when examining

social services instead. Again, for the hypothesis to find initial support, it needs to be shown that

the information stimuli have a positive effect on the willingness to pay of respondents in the

eighth and ninth income-categories, earning 26 000–29 999 and 30 000–36 999 SEK. The same

statistical analysis is performed, but for social services.

Income (SEK) N (=409) Treatment Group Mean

Control Group Mean

Difference (T-C)

Significance Level

26 000–36 999 202/207 6,35 6,11 0,24 (0,17) 0,17

23

Table 3: Effects of information stimuli on the willingness to pay for social services.

*: p<0,1 **: p<0,05 ***: p<0,01. Standard errors of differences in parentheses.

Table 3 follows the same structure as before. Comparing these results with the first results that

were shown regarding elder care, a lot looks the same. The pattern is similar among respondents

earning 19 000–29 999, with tendencies for increases in willingness to pay. Again, it is only

among those earning 26 000–29 999 that this increase is significant. A somewhat clearer

tendency for an increase is present among those earning 30 000–36 999, but it is not significant.

Moving up the income ladder, there are no real tendencies for differences in any direction, until

one reaches those earning more than 65 000. As would perhaps be expected, these respondents

decrease their willingness to pay by 1,11, which is a significant decrease. As previously, these

patterns can be illustrated graphically, which is done below in Figure 2.

Income (SEK) N (=880) Treatment Group Mean

Control Group Mean

Difference (T-C)

Significance Level

19 000–22 999 13/18 5,78 5,23 0,55 (0,75) 0,46

23 000–25 999 31/31 6,13 5,55 0,58 (0,52) 0,27

26 000–29 999 71/84 6,00 5,28 0,72** (0,33) 0,03

30 000–36 999 131/123 5,50 5,27 0,22 (0,26) 0,39

37 000–44 999 91/92 5,17 5,29 -0,11 (0,30) 0,71

45 000–54 999 63/49 5,27 5,22 0,04 (0,39) 0,91

55 000–64 999 20/22 5,27 5,20 0,07 (0,63) 0,91

≥ 65 000 18/22 3,73 4,83 -1,11* (0,65) 0,09

24

Figure 2. Effects of information stimuli on the willingness to pay for social services.

While some significant results were found when looking at respondents with the highest income,

the hypothesis is mainly concerned with the respondents that have been defined as being middle

class. Hence, the combined analysis of respondents earning 26 000–36 999 is performed here as

well. As before, there is a numerical advantage to this, and the results ought to provide a clearer

and more interpretable result.

Table 4: Effects of information stimuli on the willingness to pay for social services. Income category: 26 000 –

36 999 SEK.

*: p<0,1 **: p<0,05 ***: p<0,01. Standard errors of differences in parentheses.

Looking at the effects for all the respondents earning 26 000–36 999, a significant increase in

willingness to pay for social services of 0,43 can in fact be distinguished. Considering the results

for elder care, this is perhaps surprising, but it serves as a first indication that the hypothesis may

Income (SEK) N (=411) Treatment Group Mean

Control Group Mean

Difference (T-C)

Significance Level

26 000–36 999 202/209 5,70 5,28 0,43** (0,20) 0,04

25

be proven to be correct, at least in the case of social services. Here, the information stimuli do

cause an increased willingness to pay among the middle class-respondents. Now, it is time to

proceed with the adding of the two conditions. This is done by adding the factors (1) access to

high-qualitative welfare services, and (2) preference for free choice together with ideology.

Access to high-qualitative welfare services, preference for free choice and ideology

The first task here is to add the factor of access to high-qualitative welfare services. This is done

in order to provide the first condition, which needs to be satisfied if the main hypothesis is to

be given further support. In statistical terms, this means adding a third factor to the interaction-

model. Through this analysis, it is possible to determine how the information stimuli affects the

willingness to pay among respondents, grouped based on their income and their low access to

high-qualitative welfare services. First, this is done for elder care in order to see whether a low

access to elder care does anything to change the insignificant results that were found. The same

analysis is then done for social services. Something worth noting at this point is that this

elaborate grouping of respondents makes the number of respondents in each group very low in

some cases. If further support for the hypothesis is found when adding access, the preference

for free choice, and ideology will also be incorporated. This, then, is to try to satisfy the second

condition, which is that the middle class-respondents increase their willingness to pay because

of their individualistic preferences.

Table 5: Effects of information stimuli on the willingness to pay for elder care. Respondents with a low access to

high-qualitative elder care (< 5).

*: p<0,1 **: p<0,05 ***: p<0,01. Standard errors of differences in parentheses.

Income (SEK) N (=245) Treatment Group Mean

Control Group Mean

Difference (T-C)

Significance Level

19 000–22 999 6/9 6,78 5,67 1,11 (1,04) 0,29

23 000–25 999 14/11 6,27 5,93 0,34 (0,79) 0,67

26 000–29 999 25/33 6,39 5,92 0,47 (0,52) 0,37

30 000–36 999 44/38 5,53 5,52 0,00 (0,44) 0,99

37 000–44 999 35/45 5,89 5,74 0,15 (0,44) 0,74

45 000–54 999 26/21 5,57 5,46 0,11 (0,58) 0,85

55 000–64 999 9/7 5,00 5,27 -0,56 (0,99) 0,58

≥ 65 000 11/11 3,82 5,64 -1,46* (0,84) 0,08

26

Comparing these results from Table 5 with the initial results for elder care (Table 1), the effects

are stronger overall. Having low access clearly matters to how one reacts to the information

stimuli. The effects, although overwhelmingly insignificant, range from a distinct tendency for

an increase to a significant decrease in willingness to pay. The number of respondents in the

groups with the most marked effects are very low, however. However, there are no significant

increases in willingness to pay for elder care among respondents earning 26 000–29 999 and

30 000–36 999. Since there is not even a tendency towards an increase in the latter group, there

is no point in combining these groups, to get a more substantive result to interpret.

The conclusion at this point must therefore be that the hypothesis does not find any support

when examining the effects of the information stimuli in the case of elder care. Regarding the

micro-level indicator, it now comes down to the social services to provide the support that is

needed for the hypothesis to not be discarded.

Table 6: Effects of information stimuli on the willingness to pay for social services. Respondents with a low access

to high-qualitative social services (< 5).

*: p<0,1 **: p<0,05 ***: p<0,01. Standard errors of differences in parentheses.

Judging from Table 6, although there are no significant effects, there is a pattern to be found.

Respondents earning 19 000–36 999 all react with at least a tendency towards increasing their

willingness to pay for social services as an effect of the information stimuli. Moving higher up

in the income categories, it is less clear since the directions of the effects vary, for example when

comparing those earning 45 000–54 999 and those above. Interestingly, and with importance for

the hypothesis, it looks as though respondents in both key income categories react with an

Income (SEK) N (=278) Treatment Group Mean

Control Group Mean

Difference (T-C)

Significance Level

19 000–22 999 6/8 6,75 5,17 1,58 (1,24) 0,20

23 000–25 999 12/9 5,78 5,08 0,69 (1,01) 0,49

26 000–29 999 21/29 5,55 4,62 0,93 (0,66) 0,16

30 000–36 999 37/39 4,97 4,14 0,84 (0,53) 0,11

37 000–44 999 25/34 4,79 4,84 -0,05 (0,61) 0,94

45 000–54 999 14/20 4,70 3,50 1,20 (0,80) 0,14

55 000–64 999 3/7 5,14 5,33 -0,19 (1,59) 0,91

≥ 65 000 5/9 3,33 4,20 -0,87 (1,28) 0,50

27

increased willingness to pay; the increase is 0,93 for those earning 26 000–29 999, and 0,84 for

those earning 30 000–36 999. These increases are ‘almost’ significant, and there is then good

reason to combine the two groups as to get a more substantive result.

Table 7: Effects of information stimuli on the willingness to pay for social services. Income category: 26 000 –

36 999 SEK. Respondents with a low access to high-qualitative social services (< 5).

*: p<0,1 **: p<0,05 ***: p<0,01. Standard errors of differences in parentheses.

Combining the two income categories as to make up the whole key, middle class-interval, a

significant increase of 0,91 can be distinguished. The middle class-respondents with low access

clearly increase their willingness to pay for social services as an effect of the information stimuli.

These results can be compared with those for respondents with a high access, as done below in

Table 8.

Table 8: Effects of information stimuli on the willingness to pay for social services. Respondents with a high

access to high-qualitative social services (> 5).

*: p<0,1 **: p<0,05 ***: p<0,01. Standard errors of differences in parentheses.

Income (SEK) N (=126) Treatment Group Mean

Control Group Mean

Difference (T-C)

Significance Level

26 000–36 999 58/68 5,22 4,31 0,91** (0,40) 0,03

Income (SEK) N (=372) Treatment Group Mean

Control Group Mean

Difference (T-C)

Significance Level

19 000–22 999 4/9 8,11 6,75 1,36** (0,65) 0,04

23 000–25 999 17/16 7,69 6,94 0,75** (0,05) 0,05

26 000–29 999 28/46 7,48 7,32 0,16 (0,54) 0,54

30 000–36 999 55/54 7,26 7,22 0,04 (0,84) 0,84

37 000–44 999 41/33 7,21 7,07 0,14 (0,58) 0,58

45 000–54 999 26/21 7,00 7,12 -0,12 (0,71) 0,71

55 000–64 999 6/9 6,56 7,83 -1,28** (0,57) 0,03

≥ 65 000 4/3 6,67 7,25 -0,58 (0,48) 0,48

28

Looking at Table 8, some significant differences can be found, but these are in groups with very

few respondents. Furthermore, when examining the respondents in the key income interval and

comparing them with those with a low access, it is even clearer that the effects of the stimuli are

greater for those with low access. The results for middle-class respondents with low access must

be interpreted as providing further support for the hypothesis. Now the task is to determine

whether this increase is due to the middle classes’ individualistic preferences. If not, it will be

hard to support the hypothesis. If the middle class-respondents with low access to high-

qualitative social services are first grouped according to their preference for free choice of

provider of said service, this may become apparent. Table 9 then displays the results from a

three-way interaction between the stimuli, income and preference for free choice.

Table 9: Effects of information stimuli on the willingness to pay for social services. Income category: 26 000 –

36 999 SEK. Preference for free choice: low (< 5), high (> 5).

*: p<0,1 **: p<0,05 ***: p<0,01. Standard errors of differences in parentheses.

There are no significant effects to be found in Table 9, only tendencies. At this point, though, it

may suffice to look only at the signs denoting whether the effect on willingness to pay among

those with low access and high free-choice preferences is positive or negative. If one allows for

this generous interpretation, the middle class-respondents with low preferences seem to decrease

their willingness to pay for social services. Those with high preferences, on the other hand, seem

to increase their willingness. This should at least not contradict the second condition. Now, the

same analysis is done for ideology, which may substantiate these findings.

Table 10: Effects of information stimuli on the willingness to pay for social services. Income category: 26 000 –

36 999 SEK. Low access to high-qualitative social services. Ideology: left (< 5), right (> 5).

*: p<0,1 **: p<0,05 ***: p<0,01. Standard errors of differences in parentheses.

Preference for free choice

N (=91) Treatment Group Mean

Control Group Mean

Difference (T-C)

Significance Level

Low 11/27 6,11 6,18 -0,07 (0,72) 0,92

High 31/22 3,86 3,29 0,57 (0,56) 0,31

Ideology N (=104) Treatment Group Mean

Control Group Mean

Difference (T-C)

Significance Level

Left 25/22 6,55 5,88 0,67 (0,54) 0,22

Right 25/32 4,44 3,20 1,24** (0,49) 0,01

29

First, it is sensible to give an indication of just how important these results may be in relation to

the total amount of middle class-respondents. Following Brambor (2006), the number of right-

wing middle class-respondents with low access are divided with the total amount of middle class-

respondents: ((25+32)/411) × 100 ≈ 14 per cent. In other words, the respondents of interest

here make up a rather small part of the total. This does not mean that the results will be

worthless, but it is important to have made this clear.

Examining Table 10, the results are a bit more difficult to interpret, seeing as the respondents

seem to increase their willingness to pay regardless of their position on the left-right ideology

scale. The left-wingers react with at least the tendency towards an increase, which may be an

indication that middle class respondents with a low access, that are left-wingers, increase their

willingness as a negative reaction to privatisation.

However, it is clear from these results that the right-wing respondents react with a clear increase

in their willingness to pay, and this by 1,24 – an increase significant on the 0,05 level of

significance. It should now be clear that the positive effects on the willingness to pay is present

among those with individualistic preferences - the mechanism behind the hypothesis seems to

hold. The two results taken together should be sufficient as to conclude that the hypothesis finds

support in the case of social services. Evidence that supports the hypothesis on a micro-level

has thus been found. It may still be interesting to see whether any support can be found when

examining the macro-level indicator, preference for Social Democratic Welfare policy.

30

4.2. Preference for Social Democratic Welfare Policy

Lastly, then, the effects on the preference for Social Democratic welfare policy will be examined.

The expectation is that as the middle classes become more well-informed as to the progress of

privatisation of welfare services, they react with an increased preference for the policy. This

policy, in turn, is thought to represent the notion that a comprehensive welfare state is worth

supporting.

Table 11: Effects of information stimuli on the support for Social Democratic welfare policy.

*: p<0,1 **: p<0,05 ***: p<0,01. Standard errors of differences in parentheses.

Judging from Table 11, there is a clear pattern: respondents in the lowest income categories

respond with a tendency towards a higher support, whereas there are significant decreases in

support among the respondents with the highest incomes. The respondents in in the key interval,

however, do not seem to react in any clear way. The tendencies towards increases are very small,

and the significance levels are high. Judging from these results, it seems that the information

stimuli has the strongest effects among those respondents that are not of key interest to the

hypothesis. Thus, when looking at the macro-level indicator of Social Democratic welfare policy,

it seems that the hypothesis does not find any real support. A graphical illustration of said pattern

is provided in Figure 3.

Income (SEK) N (=877) Treatment Group Mean

Control Group Mean

Difference (T-C)

Significance Level

19 000–22 999 13/18 5,33 4,85 0,49 (0,80) 0,54

23 000–25 999 31/30 5,63 4,71 0,92* (0,57) 0,10

26 000–29 999 70/85 4,87 4,73 0,14 (0,69) 0,69

30 000–36 999 130/122 4,92 4,65 0,27 (0,33) 0,33

37 000–44 999 91/93 4,69 4,98 -0,29 (0,37) 0,37

45 000–54 999 63/49 4,65 4,70 -0,05 (0,42) 0,91

55 000–64 999 20/22 4,00 5,15 -1,15* (0,68) 0,09

≥ 65 000 18/22 3,73 4,89 -1,16* (0,70) 0,1

31

Figure 3. Effects of information stimuli on the support for Social Democratic welfare policy.

However, as has been made clear, the micro-level indicator, personal willingness to pay for

specific welfare services, should be given more weight with regards to the hypothesis. This is

because it was thought to be a more valid indicator of welfare state support. Support for the

hypothesis has been found in the case of social services, i.e. on the micro-level, and since this

macro-level indicator also suffers from the fact that it comes far down in the survey, the results

from this analysis shouldn’t be taken to contradict the support that has been found on the micro-

level.

4.3. Summary and Discussion

To summarise, it may first be concluded that there are indeed differences to be found when

comparing un-treated respondents with the treated respondents. It clearly matters whether one

is well-informed or not regarding the degree of privately provided welfare services, when it

comes to answering the questions in the survey. This should serve as an indication that making

the revised assumption regarding a boundedly rational citizenry, as well as using information

stimuli, was well-founded. While the results cannot be said to be conclusive across the board,

there is an important finding in that the middle class-respondents increase their willingness to

32

pay for social services, as a causal effect of becoming more informed of the degree of privately

provided welfare services. The individualistic mechanism has also been shown to hold.

If considering the weight given to the micro-level indicator, and that the expectation going into

the analyses was that any effects would probably be modest (considering the sample

composition), it should be reasonable to conclude that there is evidence in favour of the

hypothesis, namely that privatisation of welfare services increases the middle classes’ support for

the welfare state. The hypothesis followed from the theoretical argument, stressing how

privatisation could be a way of accommodating the individualistic interests of the middle classes

with regards to welfare services – an argument that followed originally from Korpi & Palme’s

(1998) Paradox of Redistribution.

At this point, two specific points of interest should be brought up and discussed. First, the fact

that the effects clearly did differ between elder care and social services. Specifically, it was only

when examining social services that a significant increase in willingness to pay could be found

among middle class-respondents. It is hard to give a full and adequate explanation of why this

was the case, but one explanation may lie in the information stimuli themselves. The respondents

were informed that the share of people living in privately provided nursing homes had increased

to 20 per cent, and that the share of disabled people living in privately operated care comes had

been constant at 25 per cent. It is possible that the difference in the share of private provision

in these services caused different reactions with regards to the willingness to pay for the services,

in the way that the larger share of 25 per cent caused a stronger reaction. Another explanation

may be that the middle class-respondents simply are better informed when it comes to

privatisation of elder care, hence causing a lower reaction. There are bound to be several factors

at play, and it is difficult to say for certain what caused the inconsistency. These may serve as

possible explanations though, and they should not contradict the conclusion that has been made

with regards to the hypothesis.

Second, it has been clear throughout the analyses that the positive effects of the experiment on

the willingness to pay (as well as the preference for Social Democratic welfare policy) have been

more apparent among respondents with incomes below the key middle class-income interval. It

is not clear what this means. It is possible that the preferences of the middle classes extend

downwards to those earning less as well, but this would need to be investigated more thoroughly

than what is possible at this point. It is also unclear how this should be incorporated into the

framework provided by Korpi & Palme (1998), seeing as they have an explicit focus on the

middle classes.

33

5. Conclusions

The purpose of this paper has been two-fold. First, it has sought to test the hypothesis that

privatisation increases the Swedish middle classes’ support for the welfare state. A survey-

experimental approach was used, and support could be found for the hypothesis. Second, it has

sought to provide insights into how Swedish policy makers could argue in favour of privatisation,

if their goal is to secure an important source of financing for the Swedish welfare state – i.e. the

middle classes. This follows from the Paradox of Redistribution, the theoretical argument, and the

hypothesis that has been supported. Whether a development towards privatisation could erode

societal values of universalism, solidarity and social egalitarianism, is hard to say at this point.

Possibly, this development could prove negative to these values. But it may nevertheless be a

way of securing a fundamental support for a comprehensive welfare state, in times characterised

by austerity politics and welfare state retrenchment.

A central point of concern to address is that this study has made too grand claims regarding the

causal relationship between two complex phenomena. It has been suggested that an increase in

willingness to pay for a specific service, following the exposure to information stimuli, could be

taken to indicate an increased support for the Swedish welfare state. This could be questioned

based on the comparatively low possibilities of making credible generalisations based on a

survey-experiment.

It is a relevant concern, and it is important to be humble with regards to the possibilities that the

results from this study could look different had different choices been made along the way, for

example with regards to the coding of variables in the statistical analysis. Even so, the study

should provide a small but important contribution to the literature, seeing as it has shown that

there exists a causal relationship between information regarding privatisation and the willingness

to pay for at least one specific welfare service. As has been stressed, it is really the experiences

of welfare services that citizens use to form their opinions on the welfare state, and the

advantages of using them as indicators should therefore be acknowledged. Following this, the

causal evidence that has been shown should be substantial with regards to the relationship

between these two phenomena.

It should once again be stressed that the definition of middle class that has been done in this

paper has been subjective, following the author’s own assessment in the Swedish context. It is

by no means obvious that the ‘best’ definition has been made, but it is also unclear what the

‘best’ definition may be. Going forward, there is definitely room for considering different

approaches to this issue. Should income be preferred, or should one consider the

34

advantageousness of vocation, or other relevant categories? If income is preferred, at what salary

does one count as middle class? These questions could be investigated more thoroughly.

The limited number of welfare services that could be used, the inconsistencies between the

welfare services that were used, and the similarities in reactions among the middle classes and

lower income earners, also suggest a need of further studies, looking further into the causal

relationship between privatisation and middle class-support in the different welfare sectors. The

self-selected respondents have also been a source of concern, and it would be interesting to see

a similar study, using information stimuli, done on a representative sample. In other words, there

is more to be done in the area of survey experiments with information stimuli, and in the

extension of the Paradox of Redistribution to the domain of welfare services – an extension highly

relevant to the literature on welfare issues, and the question regarding the prospects of financing

the future Swedish welfare state.

35

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