![Sample our Geography journals, sign in here to start your FREE access for 14 days]({"type":"image" , "src" : "/sda/5937/TOC-Subject-Sample-2021-Geography.jpg"})
Abstract
The financialization of households complicates how we compare housing systems and welfare states. This article explores the shifting relationships between wealth inequality, welfare states and household risk, focussing on the roles of housing and mortgage markets. We show national regimes of capitalism continue to shape experiences of risk, but increasingly through asset-based welfare mechanisms, centred on housing ownership, that are inadequately captured in existing comparative literature. Using OECD data, our argument is developed in two steps. First, we demonstrate that national patterns of wealth inequality do not follow classical welfare state categories, but mean wealth levels do, suggesting a distinct structural relationship. Second, we connect wealth inequality to the risks of housing ownership and household debt, focussing on house price falls in the United States, Italy and Denmark following the 2007–2008 financial crisis. We find mortgage default rates reflect welfare state categories rather than measures of financial risk, revealing an emerging ‘hybrid’ role of social insurance in supporting household liquidity.
Acknowledgements
Many thanks to Lisa Adkins, Anna Boucher, Martijn Konings, Hang Young Lee and Adam Morton for their helpful feedback on draft versions of this paper. Thanks to Carlotta Balestra who provided additional unpublished data from the OECD Wealth Distribution Database. Thanks also to three anonymous reviewers, and Housing Studies editors, for their valuable comments and editorial guidance.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Notes
1 Other data sources, such as the Luxembourg Wealth Study and the Credit Suisse Global Wealth Report, also provide valuable comparative data on wealth. Given our purpose is to understand the conceptual relationship between the organisation of the welfare state and wealth inequality (rather than engage in methodological debates on measuring wealth inequality), using a single source helps to trace relationships and unpack measures. The Luxembourg Wealth Study also has data for fewer countries than the OECD database, notably not including Denmark.
2 Comparisons with other countries are limited to those countries with relevant OECD wealth data that were included in Esping-Andersen’s original WoW typology. This excludes Sweden and Switzerland, for which consistent and comparable wealth data from the OECD is not available (Balestra & Tonkin, Citation2018; OECD, Citation2019c).
3 Measures of mean household wealth are shaped by how wealth in different kinds of pension schemes are treated. The OECD does not include wealth in occupational pensions that sit between, and have hybrid charateristics of, universal public pensions (which are not counted) and voluntary private pensions (which are counted). Including Denmark’s mandatory occupational pension schemes increases its mean level of net wealth for all households to approximately $US200,000, which places it on a similar level to other Nordic countries, but lower than other countries in liberal and conservative regimes (Balestra & Tonkin, Citation2018, p. 30).