ANALYSIS OF THE EFFICIENCY OF THE WELFARE STATE SPENDING: TURKEY AND EUROPEAN COUNTRIES

Abstract

Education, health and social protection expenditures, the total of which is considered as welfare state spending, are public expenditures with national significance in current times. Despite the neoliberal policies that have been prevalent in the global scale since the 1980s, it was observed that welfare state spending and related state interventions have not decreased and even continued to increase along with social changes. Adequate use public spending without squandering is important for economic wealth as well as the amount of public spending. In the present study, the efficiency of welfare state spending in European countries and Turkey was compared with Data Envelopment Analysis (DEA). Cluster analysis was conducted to ensure the homogeneity of the decision-making units among the analyzed nations. Based on the DEA findings for the first cluster, it was determined that Ireland had the lowest efficiency score and an improvement of 65.11% and 45.86% was suggested in Employment and the share of lowest 10% in GDP variables. In the second cluster, Romania had the lowest efficiency score. Turkey, on the other hand, ranked 10th among 16 countries in efficiency ranking. The most referenced nation in this group was Portugal.