Educação e Política Social

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Introduction
In Anglo–Saxon countries education policy is
usually seen as part of ‘social policy’, a term
whose meaning is not identified with social
security and social insurance only. As T. H.
Marshall’s essay on ‘citizenship and social
class’ and the Beveridge reforms demonstrate,
an integrated view of social policy and educa-
tion lies at the roots of UK welfare state
reform right after the Second World War.
Moreover, education reform even signified the
‘welfare state’ reform of the time. In his classi-
cal 1949 lecture and 1950 essay on ‘citizen-
ship and social class’ Marshall spends much
more time and space on education reform
than he does on social security reform
(Marshall, 1964). In the US, as well, the
education sector was well developed and even
served as an Ersatz-welfare-state (Heidenheimer,
1981).1 However, in Germany, as in other
countries, education and social policy are still
separated by some traditional feudal notion of
class, and after 1955 the notion of ‘social
reform’ referred to an issue of pension reform
only. Education reform came from the dark
only in the 1970s and was seen to take place in
a universe quite distant from social policy.2
Now at the start of the 21st century – with the
shift to a knowledge society – this 19th century
constellation may turn into a massive competi-
tive advantage for the Anglo–Saxon world.
In this study we document how education
and social policy are interconnected (see also
Room, 2002; and earlier Finch, 1984) and
contribute to developing standards for social
reporting in this area. We compare two pos-
sible definitions of educational poverty, one
based on years of schooling or degree
attained, the other based on competences. A
brief international comparison will address
the distribution of competences: four worlds
of competence production will be outlined,
drawing on two analytical dimensions, the
extent of differentiation and the absolute level
of competences. Finally, we will offer an
outlook on educational politics after PISA
2000 in Germany that should be of interest
for the discussion in other member states. (In
the Addendum we document the intra-
German leagues of competence production
related to the international landscape.)
Education and social policy
Deficiencies in the education system con-
tribute to massive social problems, like illiter-
acy for some and exclusion from normal
modes of integration by formal and vocational
training and labour market entry for many.
Educational attainment and labour market
outcomes are strongly connected, and low
attainment in the educational sector may easily
lead to precarious positions in the labour
market. To integrate reporting on the distribu-
tion of human capital and the resources of
education into national poverty reports would
seem to provide a special political challenge.
European and national politics at the start of
Education and the welfare state:
the four worlds of competence production
Jutta Allmendinger, Institute of Labour Market Research, 
Nuremberg, and University of Munich, Germany – Centre for Social
Policy Research (CeS) 
Stephan Leibfried*, University of Bremen, Germany
European Briefing
Journal of European Social Policy 0958-9287 (200302)13:1 Copyright © 2003 SAGE Publications, London, Thousand 
Oaks and New Delhi, Vol 13 (1): 63–81; 031047
* Author to whom correspondence should be sent: Stephan Leibfried, CeS, Parkallee 39, D 28209 Bremen,
Germany. [email: stlf@zes.uni-bremen.de]
http:\\www.sagepublications.com
the 21st century should confront this chal-
lenge: a service and knowledge society will
depend on the qualifications of the average
citizen and not just of the elite; on her or his
productive and integrative capabilities. Also
we are talking about a substantial political
capital on which the development of the
common weal depends.
Conceptually and empirically the separation
of the spheres of education and social policy
induces deficits at the national level, though
member states are confronted with better
practices at the EC level. At the level of
European integration the English tradition
was absorbed and education as well as social
security are both seen as part of one (social)
policy sphere and thus are no longer concep-
tually isolated from each other. For both
domains (re)distributional issues are seen as
part of a continuum: thus (income-)distribu-
tive as well as life course issues can be cast in
a preventive mould and opened up simultane-
ously for early intervention. The usual post-
hoc plus compensatory pattern of a reactive
policy structure, so typical for pension-led
social security, may be bypassed.
The different development patterns of
national social policy may be illustrated by the
works of Manfred G. Schmidt (1999). He con-
trasts social security expenditures, which in
general only look back (retrospective), with
forward-looking (prospective) education and
research policy. Germany will have to choose
one of two courses: compared with Germany,
countries in the Anglo–Saxon world are indeed
more concerned with human capital develop-
ment and invest much more in education than
in social security policy, where Germany is
strong. In contrast, the countries of the Scandi-
navian world invest heavily both in social secu-
rity and education policy. Like Buridan’s
donkey3 Germany stands paralysed midway
between two haystacks. Germany has placed
itself in the most unfavourable position: it cul-
tivates permanently low investments in educa-
tion and combines that with hard to control,
increasing expenditures on social security.
In Table 1 the different cut and bias of pre-
ventive, prospective educational policies versus
retrospective, compensatory social policy is
outlined – the latter in Germany is typically
represented by pension insurance, the institu-
tional characteristic of the German welfare
state. This contrast will prove useful for
national social reporting.
According to T. H. Marshall (1964),
educational policy influences future market
processes by extending and improving qualifi-
cations useful in the labour market. Post-hoc
interventions by traditional (social security)
policy only reacts to results already settled in
the market-place, for example with a second-
ary distribution of primary incomes via
levying taxes or extracting contributions. If
lifelong learning really became a fact the dis-
tinctions would fade on which this scheme
64 Allmendinger and Leibfried
Journal of European Social Policy 2003 13 (1)
Table 1 Characteristics of preventive educational policy and compensatory social policy
Preventive Compensatory
educational policy social policy
1 2
Life phase more towards youth more towards old age
Time bias prospective retrospective
Format influencing the preconditions of reacting to market outcomes
future market processes already completed
Typical social policy approaches producing qualification for effecting compensatory
developments to be (services) monetary transfers
Relationship to status status-making status-maintaining
Source: Allmendinger (1999), slightly revised.
builds. Also, increasing child poverty and the
expansion of the attendant social policy
would give post-hoc German welfare state
intervention (as described in Table 1, Column
2) quite another spin, somewhat weakening
the present bias towards elderly people in
social policy. In any case, focusing on an edu-
cationally oriented social policy per se con-
tributes to a productive reorientation of social
policy in general that is preventive and human
capital enhancing (‘social investment state’).
Measuring educational poverty
How do we define educational poverty? The
answer to this question is crucial for national
social reporting. We might refer to best prac-
tices in other fields, such as inadequate
housing (including homelessness), bad health
and income deficiency. If we want to measure
the individual attainment of educational
resources we might start out from an absolute
poverty standard, a pure minimum standard.
Literacy might do andcould be measured by
not having a school degree or not having fin-
ished one’s vocational education or by having
reached only a very low level of competence.
We could also rely on relative measures which
would automatically fix some cut-off-point
along the full range of educational resources.
Then we might label everybody educationally
poor who was below that cut-off-line, for
example who belonged to the lowest quintile
or quartile (Allmendinger, 1999: 40).
In addition we could distinguish a national
– say a German – from an international per-
spective on the distribution of educational
resources; the latter, for example, being useful
when comparing Germany with other member
states of the European Union. Persons who
belong to the educational elite nationally may,
in international perspective, turn out to
belong to the educationally poor. This change
in perspective demands even more attention as
the international integration of markets for
goods and labour – and also of (educational)
services – makes it less and less rewarding to
rely on a purely national approach. Qualifi-
cation profiles of occupational training date
ever more rapidly, and they do so as interna-
tional dependency increases. In a very short
time – in fact in an ever shorter time – ‘plenty’
can turn into ‘poverty’. Just look at the inter-
action between the new technologies and
changes in qualification profiles over the last
two decades. In the domain of educational
‘plenty’ we refer to the German public debate
– which has continued now for some decades
– in which university education in Germany is
compared mainly to that in the US; the result
has been that German university education
has been somewhat expanded to cover more
of each age cohort and has also become more
rigidly structured, thus trying to cope with
growing interdependence by imitating a
foreign model.
Such a focus on persons rather than on
institutions can be systematized as outlined in
Table 2.
If we stay with the logic of this scheme, we
may explore some of the horizons in building
standards for social reporting about educa-
tional poverty and plenty. We want to pick
Education and the welfare state 65
Journal of European Social Policy 2003 13 (1)
Table 2 Educational poverty and the distribution of educational resources
national international
absolute
1 3
illiteracy
relative
2 4
position in the national structure position in the international structure
illiteracy
of distribution of qualifications of the distribution of qualifications
Source: Allmendinger (1999), slightly revised.
those measurement devices best suited for
diagnosing the social malaise and also for
choosing policies which might correct educa-
tional plus social policy biases revealed here.
We will focus on two such horizons in meas-
urement, certification and competences.
Measuring educational poverty through
certificates
Let us start with (lacking) certificates for
measuring poverty and go through all four
boxes in Table 2 above.4 Box 1 is about
absolute poverty in the context of the national
state: illiteracy would translate here into a
missing diploma at least from the normal
school (‘Hauptschulabschluss’). Similar to the
Support Scale (‘Regelsatz’) in German Social
Assistance (‘Bundessozialhilfegesetz’ – BSHG)
we would rely here on an administrative stan-
dard that is obligatory for all, i.e. the long tra-
dition of compulsory school laws, (starting in
the early 19th century) according to which
one is required to finish school or occupa-
tional training. Required school attendance is
an institutional functional equivalent to
legally required minimum wages (as they tra-
ditionally exist in Anglo–Saxon countries and
in the Netherlands but not in Germany) or to
Social Assistance Basic Income (as in the
BSHG in Germany). Since in Germany the
premium is not on years of attendance but on
holding a degree, getting a certificate, being
uncertified (by the school or the dual system)
seems to provide a hard and clear indicator
for an ‘undersupply of educational resources’.
Social reporting could build on this social fact.
Poverty in the sense of ‘the uncertified’ in
Germany can be found for about 10 percent
of each school leaving cohort, mostly affecting
children of foreign descent (Allmendinger and
Hinz, 1998; Weißhuhn, 2001). Problems of
social integration are inherited from the
parent generation and increase if alternative
pathways are not developed in time.
Remaining with the national state, let us
now look at Box 2 of Table 2. Here we focus
on all persons who have less certified educa-
tion than the average or median of a popula-
tion. First we would have to determine a
‘middle ground’ from which we can look at the
surrounding area, for example those peripheral
groups below the average/median. Also we
could compare the different ‘middle grounds’
of different social groups. We proceed accord-
ing to the established routines for measuring
poverty. Such an approach would seem espe-
cially appropriate in Germany: here, in con-
trast to the Anglo–Saxon world, an academic
education is not seen as the major route to a
satisfying social life. In Germany, the qualifica-
tion of John Smith (Jan Arbeitsmann) is
emphasized by an encompassing and broad
occupational education via the ‘dual system’.
Public educational expenditures are weighted
accordingly (see Schmidt, 2002). In Germany
the ‘occupation’, or profession (‘Beruf’), is the
centripetal point of social integration, not the
‘job’. This, by international comparison, is the
broad foundation of the ‘German educational
model’. Social reporting in Germany must thus
pay special attention to what happens to
people on the stretch between the middle
ground and the low percentiles, as the tradi-
tional strength of social integration in Germany
lies there and not in university education.
Let us now leave the national sphere and
turn to Box 3, educational poverty put in
international perspective. Such a comparison
focuses on those persons who are illiterate and
have thus lost the ‘minimum connection’ nec-
essary in modern societies.5 In Germany
0.5–1.9m persons are estimated to be illiterate
(Weißhuhn, 2001: 47). In a ‘society of the
written word’ this group by definition belongs
to the periphery. In Germany this group,
though small when compared with the 10
percent uncertified, needs special attention as
it constitutes the hard core of the ‘extremely
poor’. All the difficulties reported in studying
the extremely poor would seem to hold fully
for the illiterate as well (Weißhuhn, 2001).
Internationally we may also compare rela-
tive poverty, i.e. Box 4 in Table 2. We could
ask how certificates are distributed across
66 Allmendinger and Leibfried
Journal of European Social Policy 2003 13 (1)
countries. If we divide certificates into several
categories, we can then look at unequal distri-
bution: how different is the distribution of
certificates in the lower and the higher certifi-
cation range, within an age cohort or in the
population at large? Are there nations charac-
terized by ‘precarious educational poverty’, a
situation where a good part of the population
hovers just above the educational poverty
line? Are there countries, with a bias towards
the middle level in certification, i.e. where
mass education really occupies the middle
ground? Are there clearly polarized countries,
‘divided nations’ of poverty against plenty?
We might also consider a formal measurement
here that reports on how far each cohort
exhausts the years of education within its
range.
Measuring educational poverty through
competences
With the PISA study (Programme for
International Student Assessment) of the com-
petences of 15-year-olds, educational poverty
can now also be measured through lack of
competences. According to the OECD, PISA is
about measuring those basic competences
which are required in modern societies to lead
a satisfying life economically and personally,
and also to participate actively in social and
political life. The public attention paid to theresults of this study, though, has less to do
with its measuring competence rather than
certificates, but with its comparative bent. 
In the light of competitive disadvantage,
educational problems have suddenly become a
big public issue in Germany: ‘The compe-
tences of German children, their knowledge,
their schooling, are treated as if the [German]
national football team had messed up every-
thing again’ (Mönch, 2001). Since the middle
of the 19th century this belated nation (‘ver-
spätete Nation’) has been accustomed to judge
itself by its international rankings, by catching
up, matching or overtaking (‘Modell
Deutschland’) others, especially (first) the UK
and (then and now) the US (Tennstedt, 1983;
on the reverse process see Hennock, 1987).
Being outflanked internationally – as
Germany saw itself through PISA’s eyes – by
countries such as Finland, Canada and New
Zealand for literacy, and (South) Korea for
numeracy, struck a nerve.
PISA reports evenly over the complete spec-
trum of distribution on reading, mathematical
and scientific literacy and on cross-curricular
competences. In the following we rely on liter-
acy only. PISA 2000 pays most attention to lit-
eracy and conceives it to be the strategic
parameter which determines all other factors
studied (on the concept of literacy see German
PISA, 2001: 69–137). With PISA we can
develop indicators of poverty and plenty in
the domain of competences. In Germany, PISA
was oversampled to have enough cases for an
intrastate comparison of the Länder (70,000
versus the default country sample size of
10,000; in the two city states of Hamburg and
Berlin the return rate was too low for inclu-
sion in the study). PISA is not a one-off event
but about cyclical studies of competence pro-
duction among OECD member states, thus
relying on repeated reports. PISA 2000 is just
the start. The PISA process, therefore, will
also allow continuous future reporting on
poverty and plenty in education in national
poverty reports.
On the basis of this study we can measure
educational poverty as follows (see Figure 1).
Absolute educational poverty would be
defined by Competence Level I (of five),6
which corresponds to functional illiteracy:
‘These youngsters are nevertheless not illiter-
ate. They have elementary reading capabili-
ties, but these do not help them to sufficiently
survive in practical contexts of everyday life’
(German PISA, 2001: 363). If a student does
not attain Level I, we declare him or her to be
educationally poor. We can use this approach
for a national and an international definition,
as long as we study the participating OECD
countries. If we were to take a global perspec-
tive we might rather rely on plain illiteracy as
a poverty line. In the OECD context ‘func-
Education and the welfare state 67
Journal of European Social Policy 2003 13 (1)
tional illiteracy’ would therefore replace the
indicator ‘illiteracy’ in Table 2. Relative
poverty could be similarly ascertained by
relying on the complete spread of the five
competence levels. We would look at the intra
and interstate distribution of basic compe-
tences, and at the respective bottom groups.
We might want to find out which level the
lowest decile in the competence spectrum
attains. In the following we will look at a
modified value, which is better protected
against outliers. To this end we look at the
competence levels of those who fall between
the 5th and 10th percentiles.7
According to PISA 2000 this means empiri-
cally that measured in national or inter-
national perspective absolute educational
poverty in terms of literacy amounts to 10
percent in Germany and to 6 percent in the
OECD average. In mathematics and the sci-
ences the results are similar. This decile of the
educationally poor in Germany which falls
below Level I is labelled a ‘risk group’ in PISA
2000: two-thirds are boys, 50 percent attend
grade school only (‘Hauptschule’), and 34
percent attend schools for children with dis-
abilities (‘Sonderschule’). Almost 50 percent
are born in Germany with parents also born
there, and German is spoken at home. More
than a third (36 percent) were born outside
Germany. Looked at from another perspec-
tive: of the native born only 6 percent do not
make it to Level I, of the foreign born 25
percent (German PISA, 2001: 117f.). The edu-
cational poverty rate of children with parents
of an unskilled background is 18 percent
versus 3 percent for children of parents of the
upper or lower ‘service classes’ (German PISA,
2001: 363).
If we look at relative measures and thus at
the distributional location of educational
poverty we can see that in Germany relative
poverty overlaps with absolute poverty. The
relatively poor are also absolutely poor, since
the relative poverty threshold is below the
absolute one (see Figure 1). Internationally
compared, the extent of poverty in Germany
contrasts even more drastically: in the OECD
average the lower margin of distribution com-
prises only a few absolutely poor: 
In Germany the competentially weakest 5
percent of the students achieved at max 284
points in all their tests. Thus they had 51
points less than necessary to attain Level I.
In 14 of the participating states the top
score for these 5 percent is above Level I.
On average, therefore, in these states the
weakest 5 percent are at least able to
respond successfully to those demands
measured by Level I. In Germany . . . we
need to move up to the 10th percentile to
reach the Level I line, landing right on the
border line which determines the lowest
Level I. (German PISA, 2001: 108)
Using data on competences we can also easily
find indicators for educational plenty. The line
of plenty could be operationalized with the
top Competence Level V, and the line of rela-
tive plenty could be placed so that we look at
people between the 90th and the 95th per-
centile. In Germany we have the peculiar situ-
ation (Figure 1) of the educationally rich
(about 8 percent of all students) not going far
beyond Level V. Also, among the relatively
rich in Germany we find a lot of people who,
absolutely speaking, are not rich. In Germany
strongly accented educational poverty is
paired with only average educational plenty.
Looked at from the OECD perspective this
means ‘Neither can they lead the competen-
tially weak out of poverty, nor can they form
an elite’ (OECD, 2001: 29).
Comparing horizons of measurement:
competences versus certificates
If we look at the class of persons defined as
poor measured by certificates versus the class
as measured by competences the results should
diverge empirically. In the PISA study it is
pointed out repeatedly and with undiplomatic
clarity that many students who did not make
Level I had received signals through the
68 Allmendinger and Leibfried
Journal of European Social Policy 2003 13 (1)
grading system from their teachers that they
were in step with the teaching aspirations valid
for the class: of all students under Level I, 89
percent were found by their teachers not to be
of poor reading ability and only 11 percent
were judged to be ‘poor readers’ (German
PISA, 2001: 119, Table 2.9). If we prolong
these results hypothetically to graduation days
Education and the welfare state 69
Journal of European Social Policy 2003 13 (1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
250 300 350 400 450 500 550 600 650 700
Country M (SE) SD
Finland 546 (2.6) 89
Canada 534 (1.6) 95
New Zealand 529 (2.8) 108
Australia 528 (3.5) 102
Ireland 527 (3.2) 94
South Korea 525 (2.4) 70
United Kingdom 523 (2.6) 100
Japan 522 (5.2) 86
Sweden 516 (2.2) 92
Austria 507 (2.4) 93
Belgium
1
 507 (3.6) 107
Iceland 507 (1.5) 92
Norway 505 (2.8) 104
France 505 (2.7) 92
United States 504 (7.0) 105
OECD Average 500 (0.6) 100
Denmark 497 (2.4) 98
Switzerland 494 (4.2) 102
Spain 493 (2.7) 85
Czech Republic 492 (2.4) 96
Italy 487 (2.9)91
Germany 484 (2.5) 111
Liechtenstein 483 (4.1) 96
Hungary 480 (4.0) 94
Poland 479 (4.5) 100
Greece 474 (5.0) 97
Portugal 470 (4.5) 97
Russian Federation 462 (4.2) 92
Latvia 458 (5.3) 102
Luxembourg 441 (1.6) 100
Mexico 422 (3.3) 86
Brazil 396 (3.1) 86
 Percentiles 
5% 10% 25% 75% 90% 95% 
 250 300 350 400 450 500 550 600 650 700 
Figure 1 The distribution of literacy competences internationally compared
Notes:
a M = mean; SE = standard error; SD = standard deviation.
b In the Flemish part of Belgium, the mean was 532 (SE = 4.3, SE = 96), in the Walloon part, 476 (SE =
7.2, SE = 111)
Source:
German PISA (2001: 106, Graph 2.11): English language graph provided by Max-Planck-Institute for
Education and Human Development (Berlin, Germany); we are grateful to Jürgen Baumert et al., espe-
cially Susannah Goss (MPI Berlin) and Franz Lüninghake (ZeS) for their help.
 Percentiles 
5% 10% 25% 75% 90% 95% 
Mean and Confidence Interval (± 2 SE) 
we are very likely to find competentially poor
among the to-be-certified. The estimate of 10
percent certified poor is, therefore, likely to be
quite conservative. But there may also actually
be some people rich in competencies among
the certified poor. The PISA study gives no
clues on this reverse process, since most stu-
dents at age 15, when the PISA sample was
taken, have some time to go until they may
have turned into non-certified graduates. Such
future developments could only be ascertained
in a follow-up-study of this cohort.
How do these measures compare? Which
one should be preferred? At first sight there is
much to be said for relying on competences.
First, competences, measured as forms of cul-
tural and social capital (as they are in PISA),
build up over the entire life course, relate to
the person as a whole, and can hardly be
improved within a short period of time. This
contrasts to degrees or school marks, prima-
rily relating to institutionally inculcated
knowledge, which can be improved in the
short run, e.g. by crash courses. Second, com-
petence indicators measure differences and
change and they do so in an extremely finely
graded way compared with school types and
graduation certificates. Third, a big difference
is that certification is much more school-
driven than competence scores as schools have
a lot of leeway when they measure achieve-
ments and grant certificates. In contrast, com-
petences are measured by profiles developed
outside and independent of the school system.
Differences between schools can no longer be
attributed to differences in how demanding
they are. In reverse, differences can now be
explained by some schools being better than
others, because they teach better or because
their student body is composed differently.
Also competence measures simplify interna-
tional comparisons, since differences between
education systems no longer distort the
picture. Nonetheless international compar-
isons of the level of competency reached may
allow conclusions on the salience of differ-
ences between educational systems. 
At least in Germany – in contrast to the US –
one might, however, entertain serious doubts
about relying on competence measures: how far
are competences relevant for gaining entrance to
the employment system and making a career?
Employers in Germany regularly rely on the
preselection of the school system. They measure
the qualification of their applicants with school
or vocational education certificates. Only rarely
will employers themselves test applicants and
check out the signals they receive from the edu-
cation system. They often even trust that the
certificate also implies positive valuations of dis-
cipline, adaptability and social competence. In
other words, employers do not demand compe-
tence, they want certificates. In that sense it may
be more adequate to measure educational
poverty through missing certificates as certifica-
tion is known to be a crucial process, and since
we know about the permanent life course
damage a missing certificate regularly inflicts.
We know much less about long-term conse-
quences of missing competences.8 If we are
70 Allmendinger and Leibfried
Journal of European Social Policy 2003 13 (1)
Table 3 Poverty and plenty in competences internationally compared
Absolute poverty of competences
yes no
1 3
Germany, Poland, Belgium, Finland, Canada, United Kingdom,
yes
USA, Switzerland, Denmark Japan, Sweden, France,
Absolute and Norway Iceland and Ireland
plenty of
2 4competences
Portugal, Brazil, Mexico, (South) Korea and Spain
no
Luxembourg, Liechtenstein,
Hungary and Greece
interested in the consequences of being educa-
tionally poor for the labour market at least in
Germany certificates should be better signals
than competence measures. But competences
should be more revealing if we are interested in
measuring economic prosperity, the innovation
potentials of the economy and individual
development beyond the dimension of eco-
nomic success. These processes depend more
on the potential of competences the individual
has than on his ‘paper form’, the certificate.
Whether to use competence or certification
measures is not an either/or question and cru-
cially depends on the national context. As
long as both measures do not duplicate each
other but measure different things both should
be used in tandem to define the educationally
poor. Competence measures cannot replace
certification measures but they can surely
complement them.
The four worlds of competence 
distribution
Until now we have seen educational poverty
as an institutionally pre-formed but individu-
ally measured and measurable phenomenon.
We can now look at aggregates. Complete
educational systems could be judged by how
age cohorts are distributed in different certifi-
cation tracks, how they are spread across
competence levels and how that corresponds
to certain competence bands.
Comparing countries as a whole, the pat-
terns we can make out depend on how
absolute poverty and plenty are combined.
According to Table 3 we are confronted with
four worlds of competence distribution. In
some countries educational poverty and plenty
go hand in hand, competences thus spread
across the whole spectrum from absolute
plenty to absolute poverty. This state of the
nation obtains in Germany, the USA and
Switzerland (Box 1). Diagonally across we
find the few countries who know neither
absolute poverty nor absolute plenty. This rare
situation obtains in (South) Korea and Spain
(Box 4). All other countries are situated
between these two extremes. They may know
only prolific absolute poverty but not absolute
plenty, as is the case among others in Mexico,
Brazil and Luxembourg (Box 2). Or there is
the opposite sort of countries, which only
Education and the welfare state 71
Journal of European Social Policy 2003 13 (1)
Table 4 Differentiation and level: institutional educational profiles (illustrated by the most outstand-
ing countries)
Differentiation of competencesa
low (egalitarian) high (unequal)
1 3
high
central centripetal
Finland United Kingdom
Level of (291/546)c (355/529)c
competencesb
2 4
low
peripheral centrifugal
Brazil Germany
(284/396)c (366/484)c
Notes:
a The differentiation of competences can be considered high in this context when the score is 350
points or higher and low when it falls to 300 or less. 
b The level of competences is defined as high when surpassing 520 points or low when it is at 485 or less.
c The first number reported in the brackets refers to the variance, the spread, between the 95th and 5th
percentile (equality/inequality). The second number reports the median national competence
(level/plateau).
know absolute plenty but not absolute
poverty.This situation can be found among
others in Finland, Sweden and France (Box 3).
Underneath this simplified construction two
principles obtain: the grade of differentiation-
among persons and the average level of com-
petence formation (cf. Table 4 for details).9
Education systems characterized by a high
point difference between the 5th and the 95th
percentile point – in Figure 1 they are repre-
sented by the longer boxes – differentiate
more strongly and thus produce a higher dose
of inequality. Systems which have a smaller
variance between the competentially highest
and lowest could be called egalitarian, and are
represented by the smaller boxes in Figure 1.
We need to distinguish between differentiation
and level effects: do the differentiating or
equalizing education systems lie – on average
– on a higher or lower competence plateau? In
Figure 1 this moves the boxes from the left
(low level) to the right (high level).
Relying just on differentiation and level we
find again four combinations (see Table 4): an
egalitarian country on a high plateau of com-
petency – labelled central – is Finland (Box 1).
An inegalitarian high-plateau oriented and
thus centripetal – i.e. tending towards that
centre – country is the UK (Box 3). An inegali-
tarian country, building on a low plateau and
thus centrifugally disposed – i.e. tending away
from that centre – is Germany (Box 3). An
inegalitarian, low-plateau and peripheral
country – i.e. remaining quite far from that
centre – is Brazil (Box 2).10
Differentiation and level correspond to two
institutional dimensions. Differentiation is
cultivated via the organizational and regional
patterning of the education system and is
strongly developed where tracking is empha-
sized and where selection for these tracks
takes place early. Levels vary strongly with
education expenditures, curricula and the
extent of educational expansion.
These relationships may be exemplified by
the German case: Germany is highly differen-
tiated with a standard deviation of 111 points,
which is above the OECD average of 100 and
even surpasses the US value of 105. If we look
at level or plateau effects, Germany with 484
points belongs to the trailing group – the base-
ment – of the OECD countries. The OECD
average here is 500 points, the US having 504
points and the leader, Finland, 546. Germany
thus belongs (see Table 4) to the category of
countries which are ‘centrifugally’ predis-
posed, i.e. which spin away from the middle
ground towards poverty. This stands in stark
contrast to the ‘centripetal’ US characterized
by a spin from the middle towards educa-
tional plenty. Thus educational equality in
Germany is lower than in the US and at the
same time pertains to less average education
(lower plateau). This contrast reveals the
benevolent effects of the US having taken and
stayed on the pathway to educational growth
– rather than to social security, the continental
welfare state route – since the beginning of the
19th century (Heidenheimer, 1981).
Differentiation mainly happens through the
three-track German school system with its early
– and barely revisable – selection of students
into at least three educational ‘classes’:11
In a system that differentiates early, as does
the German one, some practical consequen-
ces must be noted. If tracking decisions
have to be made at the end of the 4th grade,
the time window for interventions into the
distribution of educational chances is quite
small compared with systems which take
this decision at a later date [i.e. in a later
grade]. The more important are early and
earliest support measures in those areas of
competence, which are relevant for the
tracking decisions. (Baumert et al., 2001: 37)
Students who are weak in competence, have
difficulty with language and are somewhat
estranged from the education system by family
background cannot grow as they measure
themselves with and against the educationally
strong in one social teaching and learning
unit. Studies in the US and UK have shown
again and again that a learning environment
that is heterogeneous in regard to competence
72 Allmendinger and Leibfried
Journal of European Social Policy 2003 13 (1)
helps the competentially weak while it barely
affects the strong.
German plateau effects in the downward
direction should be mainly connected to low
German education spending.12, 13 In his com-
parison Schmidt (2002) reveals clear deficits
in financing primary, lower secondary and ter-
tiary education. In Germany financing is best
for higher secondary education (Schmidt,
2002: 6f.) and vocational education, i.e. ‘for
the qualification pointing to the middle and
[basic] higher professional positions of an
industrial society’. PISA concentrates on 15-
year-olds and in Germany thus happens to
measure missing basic competences near the
end – even a little beyond the end – of that
long stretch of relative institutional neglect.
The missing competences of these students in
the secondary education system in Germany
may well be explained by an investment bias
discriminating against primary and lower sec-
ondary education.
Other factors may affect differentiation and
level at the same time. Limiting education to a
few hours each day overemphasizes receptivity
and abstraction and underemphazises applied
and applying knowledge – compared to all-
day schools. Also, German kindergartens are
said to emphasize the ‘garden’ element rather
than education in a curricular framework.
Education starts too late – not early and play-
fully (see Gottschall, 2001). The small
Education and the welfare state 73
Journal of European Social Policy 2003 13 (1)
Table 5 Variance and median values of competency by country
Variance 95–5 Median value
OECD country averages 328 500
Extreme values maximum (Germany) 366 484
minimum (Korea) 227 525
Federal states OECD average 333 508
European Continental median 336 495
Marked continental outliers (D, CH) 350 489
Single federal states Austria 307 507
Canada 310 534
Australia 331 528
USA 349 504
Switzerland 335 494
Germany 366 484
Non-OECD federal state Brazil 284 396
Scandinavian Average 311 514
(‘social democratic’) Finland 291 546
countries Iceland 302 507
Sweden 304 516
Denmark 319 497
Norway 340 505
Anglo–American Average 331 524
(‘liberal’) countries Ireland 309 527
Canada 310 534
United Kingdom 330 523
Australia 331 528
USA 349 504
New Zealand 355 529
German language Average 336 495
(‘conservative’) countries Austria 307 507
Switzerland 335 494
Germany 366 484
‘window of education’ in the daytime and the
neglect of early childhood education as a well
dosed challenge to the children leave ample
space for ‘natural’ differentiation according to
family background. The education system
exerts no ‘pull’ effects on the lower range of
competences which raises the overall average.
Also, challenges to the educationally rich
remain quite limited, perhaps making for a
German ‘bubble elite’.
In this research note we are looking at
‘whole countries’ and we treat them in this
comparative context as coherent units. In this
vein we have just discussed the German case.
What happens when one unpacks a country
and studies its constituent or geographic sub-
units (in Germany the Länder) with PISA data
– while also sticking to the international com-
parative frame – is revealed in the Addendum.
Other countries, such as the UK, also throw
up surprises when unpacked, though of a dif-
ferent sort, since a clear federal background is
missing.
We could follow up – in our international
comparison of whole countries – on the four
worlds of competency production indicated in
Table 3 and 4, and rely on typologies devel-
oped by Gøsta Esping-Andersen in his Three
Worlds of Welfare Capitalism (1990) or
Francis G. Castles (1993) in his Families of
Nations. Table 5 may provide some additional
hints. In the end it may turn out that the fami-
lies of Frank Castles, which build on close
relations in general politico-cultural terms, are
more appropriate for understanding the rela-
tionshipbetween education and the welfare
state than Esping-Andersen’s welfare state
typology. In both cases it should be noted
that a higher typological consistency is
found only for the Anglo–Saxon sphere, while
the other types/families are much more losely
connected.
Some remarks on the world’ – or families’ –
teaching styles. The Scandinavian countries
appear much more homogeneous, and charac-
terized by low differentiation (with 311) than
the Anglo–Saxon group (with 331). The con-
servative countries (with 336) go a little
further in the direction of differentiation (with
Austria – 307 – as a more egalitarian outlier)
and an OECD average of 328. If we look at
levels, the rank order changes: the Anglo–
Saxon world (with 524) is in first place, on the
highest plateau; followed by the Scandinavian
countries (with 514; with Finland’s 546
making it an outlier) and the conservative
countries (495) arriving last, even below the
OECD average of 500.
Against our expectations, differentiation is
only slightly more evident in federal states
(with 333) than in the OECD average (with
328), in European federal states again a bit
more (336), though substantially more (with
350) in the two of the three continental
federal states in which federalism is especially
strong (Germany and Switzerland). Con-
cerning levels, all federal states together (with
508) surpass the OECD average (of 500). All
continental federal states (with 495) together
fall below the average, and if we neglect
Austria as a case of pseudo-federalism – which
is actually quite unitary – we find Germany
and Switzerland again firmly anchored in last
place (with 489). Federalism seems to work as
an amplifying mechanism. It protects decen-
tralizing tendencies obtaining anyhow, i.e. ten-
dencies to multi-track or to underinvest in
education.14
Outlook
Political challenges of educational poverty in
Germany – as they occurred in the ‘Bericht der
Staatsregierung zur sozialen Lage in Bayern’
(1998) – have until now been met by the
defence: ‘These kids are unable to do better.’
In short, they are born stupid. But the position
in the UK and also in the often cited examples
of Finland and South Korea show very clearly
that the politico-administrative environment
of such students develops their potential abili-
ties to a much greater extent than is the case
in Germany, where students are insufficiently
challenged and their intellectual growth is
stunted. Structure matters: the (school)
74 Allmendinger and Leibfried
Journal of European Social Policy 2003 13 (1)
environment itself regulates the competence
levels attained. Absolute poverty is surely
avoidable as the success of 14 PISA countries
shows (see the discussion before Figure 1). 
The encompassing introduction of compe-
tence measurement in the UK school system
coupled with introducing choice and substan-
tial fiscal consequences of such choice for the
schools affected, has led to measurable
increases in competence for students and also
raised the average of all UK schools
(Glennerster, 2001). The often expected
‘opening scissors-effect’ – where educational
reform increases the distance between the edu-
cationally poor and the rich, i.e. emphasizes a
‘divided nation’ – could not be found in the
UK. In Germany one might hope for the
resistance to competence measurement to
undergo a ‘Gestaltswitch’ into recognition of
the effectiveness of such measurements for
changing the miserable status quo.
In Germany the administrative Länder-
departments responsible for education and the
unions have tried to block the PISA study
altogether or to limit its extent. On the one
hand, what characterizes German educational
policy can be intuitively grasped by studying
newspaper reports on the long process of
making the PISA study acceptable (Schmoll,
2000: 4):
A ranking of the Länder or even individual
school type comparisons are not to be
expected from PISA, a school competency
study . . . The President of the Conference of
Education Departments (KMK), Bremen’s
Senator Lemke, knows why he is repeating
this on every possible occasion. The resist-
ance of the unions, the Union of the
Teachers (Gewerkschaft für Erziehung und
Wissenschaft – GEW), has to be overcome.
Resistance has to be broken as the union has
come forth with a strategy paper firmly out-
spoken against any competence measure-
ments. The GEW fears nothing more than a
ranking of the Länder or of school tracks. It
Education and the welfare state 75
Journal of European Social Policy 2003 13 (1)
Table 6 The German Länder and PISA
German Land Level of Differentiation of
competences competencesa
low high
Bayern 518 280
Baden-Württemberg 510 293
Sachsen 501 275
Thüringen 496 274
Rheinland 496 302
Nordrhein-Westfalen 493 313
Niedersachsen 491 314
Schleswig-Holstein 490 313
Saarland 487 297
Hessen 486 311
Mecklenburg-Vorpommern 485 278
Brandenburg 468 290
Sachsen 466 290
Bremen 459 333
Note: 
a Within Germany 300 was used here as the only dividing line between ‘low’ and ‘high’. In view of
Table 4, where 350+ was the starting point for high and 300– for low scorers, we can see: all intra-
German ‘high’ scorers are, in international perspective, medium scorers only. Take note of the score for
students in larger cities: 504/320. It would rank large cities 3rd in this table.
Source: PISA Germany (2002: 74).
sees in PISA a new control and steering
medium of education policy, finds no effects
to improve education up front and has
announced, it will mobilize parents and stu-
dents against the test. [our translation]
On the other hand, protests against the lack of
transparency of the PISA results – data on
individual schools are not published – were
never heard. Are the parents happy with this
state? Is the federal government mainly an
onlooker? Do the schools themselves avoid
competition altogether? Do the Länder, inde-
pendent of the parties ruling, have no interest
in more detailed information? And do unions
find solidarity in avoiding public information
on education results?
A look at the UK and the US, where such
data are regularly published, should make us
suspicious about this quiet on the education
front – it may just be a calm before the storm
unless sufficient information is shared to get
at the causes of the differences (via straight-
forward school comparisons) and then to
design a remedial policy. All the instinctive
revulsion against neoliberalism notwithstand-
ing, the system will have to move a little
towards ‘quasi-markets’ (see also Glennerster,
1991).
In Germany, though, some hurdles have to
be overcome which only a few countries on
the globe share: a strong federalism is com-
bined with the displacement effect of priority
topics such as social security. The great
national fleet of the ‘social security state’ –
with the pension tanker dominating the fleet –
occupies more than 50 percent of public
expenditures and shoves the little educational
boats at the Länder, county, and city levels
aside. In the OECD world this situation is
most pronounced in Germany.
In stark contrast to the UK (Glennerster,
2001), in Germany the two policy areas crucial
for managing social risks (welfare and educa-
tion15) are almost completely off-limits for the
federal government as they fall within the con-
stitutionally protected domain of the Länder.
The situation for income poverty and plenty
(welfare or social assistance) differs somewhat
from education as the federal government is
the taxing hegemon, thus affecting the forma-
tion of income.16 If social reporting on educa-
tional poverty were done by the federal
government it would thus become active in an
area where it can change little. National social
reporting in this area would be Ersatz politics
as well as policy Ersatz. It would be Ersatz
politics as the federal government has no
direct – and almost no indirect – policy access
to that sector, hence encouraging the federal
level to indulge in merely symbolic grand-
standing. Policy Ersatz points to the fact that
the political discussion acrossGermany takes
place as a purely theoretical exercise, and such
public discourse may simply prove to be a cul-
de-sac since it occurs in lieu of thorough
reforms at any federal level. At the very least
this process postpones such reforms or slices
them up like a salami Länder-wise.
To suggest ‘quasi-markets’ in federal
Germany would also give the ‘quasi’ of these
markets a different meaning and function from
what pertains in the UK. The coming competi-
tion among school systems and schools has to
be set free and contained at the same time by
changing the institutional environment, and by
allowing results-oriented federationwide (and
federal) compacts and experimentation. There
will be neither a single educational market nor
a unitary state – as it exists or existed in the
UK, though separate developments in Scot-
land,17 Wales and Northern Ireland were
recently sanctioned through devolved powers,
pointing towards quasi-federal developments.
Germany could move towards a coordi-
nated education-federalism, which would rela-
tivize or break the dependence for all school
personnel finance on the Länder and for all
other school resources on the counties; and
Germany could break the stranglehold of the
tracking system – be it of the three traditional
class-oriented tracks (vertical tracking) or of
the age-oriented social division between
education and kindergarten (horizontal track-
ing).18 Such a strategy would attempt to
protect but at the same time contain German
76 Allmendinger and Leibfried
Journal of European Social Policy 2003 13 (1)
federalism in this area.19 A Bund–Länder
compact establishing a well endowed ‘educa-
tion foundation’ administered cooperatively
by all parties to the multitiered system might
be one form this federated breakthrough
could take.
In general Germany may choose to follow
one of two pathways.20 The Anglo–Saxon
way would give priority to education over
social security investments or the Scandinavian
way would prioritize both investment areas at
a high level of expenditures. Until now
Germany has chosen to combine high social
security with low educational expenditures – a
directionless strategy which, at the beginning
of the 21st century, mainly results in Buridan’s
starving donkey. One way or another,
Germany needs to remember a maxim of the
educational reform of the 1970s: ‘the school
of the nation . . . is still the school’ (Willy
Brandt).21
Addendum: Opening Europe’s
Pandora’s boxes? A look at the
German case ‘from above’
In this article we have been concerned with
variance among countries not with variance
within countries. Nevertheless it is interesting
to open at least one of these closed country
boxes, as the German intra-country results
now published (PISA Germany, 2002) are –
due to an extended sample – unusually
informative as compared to other country
data. These data allow us to look at and order
intra-German differences using the two indica-
tors we relied on in Table 3 for our interna-
tional comparison.
Of the 16 German Länder, data for only 14
were evaluated. The two not evaluated
(samples were deemed too small and too
biased due to low response rates), i.e. Berlin
and Hamburg, are likely to be low scorers.
One common German trait emerges: none of
the Länder was without absolute educational
poverty – that includes Bavaria, the intra-
German champion. Most of the Länder cross
the border line to educational plenty. But 4
Länder do not cross that border line:
Mecklenburg-Vorpommern, Sachsen-Anhalt,
Brandenburg and Bremen. They thus fit right
into Box 2 of Table 3, together with Portugal,
Brazil, etc.. The other 12 Länder fit into Box 1,
the ‘home’ slot for all of Germany. (Hamburg
and Berlin are most likely Box 2 cases, or,
failing that, Box 1). Without radical policy
changes addressing the common German
feature of pronounced absolute educational
poverty, a road to Box 3 or 4 seems inacces-
sible to any German Land. The intra-German
debate in 2001/2002 has been fixated on the
‘pure politics of ranking’: who is first and last,
etc.? Bavaria – the Stoiber state – is seen to fit
right after Sweden in Figure 1; and Lower
Saxony – the (former) Schröder state – ranks
somewhere out there between Poland and
Greece. This debate’s blind spot is the shared
‘class of the ranked’: all German Länder cross
the border line into absolute educational
poverty and thus stand out in the OECD
world.
Applying the international threshold values
in Table 4 (see Notes a and b there) to an intra-
German comparison (see Table 6 for a
summary of the German Länder) would place
4 German Länder in Box 2 with Brazil:
Saar land, Mecklenburg-Vorpommern,
Brandenburg and Sachsen-Anhalt. Some states
like Bremen manage to escape this fate since
they just touch or cross the line into
Competence Level V. None of the German
Länder would fall into Boxes 3, 4 or 1 of Table
4. Thus, all other 10 German Länder studied
are to be found on the large and invisible
middle ground left between the two high–low
definitions on which Table 4 builds. Germany
as a whole is highly differentiated in compe-
tency. But this does not result from an ubiqui-
tous spread of these characteriztics equally
across the territory. Rather, it results from
combining distinct Länder like Bremen (with
substantial absolute educational poverty) at
the one end with the likes of Bavaria (with
substantial educational plenty) at the other.
Education and the welfare state 77
Journal of European Social Policy 2003 13 (1)
To look into several of these closed country
boxes in parallel may be a challenge to com-
parative research, as inter-country differences
could then be compared with intra-country
differences. Take for example the contrast of
Germany and Spain, i.e. of two now federal
states. We already know from the Spanish
data that Spain is characterized by no absolute
poverty and no educational plenty across all
provinces (see Figure 1 and Table 3, Box 4). If
there are any territorial clusters in Spain they
must form within that narrowed band, that
smallish box of competences shown in Figure
1. So, how come a federal state, especially an
asymmetric one such as Spain, can be so
‘unitary’ in educational outcomes, a matter so
dear to the heart of regionalists? And how can
outcomes be so different in a nation like
Germany, where federalism is constitutionally
and often also empirically tied to the
‘Einheitlichkeit der Lebensverhältnisse’, the
basic equivalence of outcomes (Oeter, 1998)?
But a comparison might also reach out to
unitary states, since a lot of variance may hide
behind a unitary administrative facade. Let us
take the UK as an example: are there regional
clusters, say, spreading from Northern Ireland
and Wales up to Scotland and then to southern
England?22 How do they compare with the
intra-German spread? If such regional–territo-
rial variance were to exist in the UK, how
would that fit its quasi-unitary educational
system and aspirations? France may provoke a
stronger inquiry along similar lines. We do not
know enough about these countries (and about
regional PISA evaluations done within them).
On most of these countries we may not even
have sufficient data because they did no over-
sample as Germany did. In Switzerland, for
example, we would need sufficient sample size
at cantonal level to be able to answer such
questions. In this research note we can do no
more than raise such questions – and suggest
further research and data gathering. The issues
at hand are explosive enough – all across
Europe – to warrant continuous attention.
Acknowledgements
We would like to thank Petra Buhr, Francis G.
Castles, Howard Glennerster, John Hills,
Richard Hauser, Jane Lewis, Karl Ulrich
Mayer, and Herbert Obinger for help, advice
and critique. This article is a condensed and
extended (Addendum) version of Jutta
Allmendinger and Stephan Leibfried (2002)
‘Bildungsarmut im Sozialstaat’, in Günter
Burkart and Jürgen Wolf (eds) Lebenszeiten.
Erkundungen zur Soziologie der Generationen.
Martin Kohli zum 60. Geburtstag (Opladen:Leske & Budrich), pp. 287–315. This German
article also fully documents the public debate
on the First German National Poverty Report
(BMA, 2001) since April 2001 and on PISA
2000 since December 2001.
Notes
1 Wilensky (1975: 3–7) rather conceives education
as having a complementary role.
2 We should also note that up to the mid-1990s,
no (material) poverty was thought to exist in
Germany and using the word ‘poverty’ until
1998 violated political etiquette.
3 This alludes to remarks attributed to the French
philosopher Jean Buridan (c. 1300–60) which
have become proverbial in Germany and France.
4 In the following we rely on arguments in
Allmendinger (1999).
5 Two groups may be distinguished here: illiterates
in their own mother tongue, and persons who
are literate in their mother tongue but not in the
language of their country of abode. Both forms
of illiteracy decouple from the formal education
system and place these persons out of reach of
adult or continuous education programmes.
6 The complex construction of the indicator
‘Competence Level I’ is explained at length in
German PISA (2001: 88–97). A short orientation
is provided by the contrast involved in the
description of Competence Level II just above it:
‘From the description of the typical demands of
the different levels of competence . . . it may be
concluded, that the demands of Level II should
regularly be seen as minimum standards’
(German PISA, 2001: 98; authors’ emphasis).
Thus Level I marks a lower, clear and demon-
strable level of poverty, that may be seen as a
minimum-minimum level. We report only three
demand profiles used for not-meeting Level I
78 Allmendinger and Leibfried
Journal of European Social Policy 2003 13 (1)
criteria here: processing information – several
independent, but expressly given pieces of infor-
mation cannot be found; text-related interpreta-
tions – the main idea of a text is in no way
recognized; reflection and valuation – no simple
connection is made between information from
a text and broadly accessible everyday knowl-
edge.
7 At this time we have no access to the complete
distribution of competence points in Germany
and the countries with which it might be com-
pared. Thus we cannot construct sliding scales of
relative educational poverty similar to the rela-
tive income poverty measurements.
8 The findings of the International Adult Literacy
Survey of the OECD (2000) indicate, though,
that adults who have higher literacy scores also
have higher earnings and are more rarely
affected by unemployment then are lower scorers
(cf. German PISA, 2001: 116).
9 The concept of differentiation is related to the
concept of stratification normally used in educa-
tional sociology (cf. on the latter Allmendinger,
1989).
10 Because of the polarization into high and low
levels of competence, countries which are char-
acterized by concentrating most people on the
middle ground do not appear in Table 4. Box 4
of Table 3 thus finds no correspondence in Table
4. Box 2 in Table 3 corresponds to Box 2 in
Table 4, and Box 3 in Table 3 to Box 1 in Table
4. In Box 1 of Table 3 two types are compressed
which are held apart in Table 4: countries from
Box 1 in Table 3 which spin towards educational
plenty – such as the UK, New Zealand, but not
so strongly the USA (see Box 3, Table 4) – and
also countries characterized by gyrating towards
educational poverty, for example Belgium and
Germany (see Box 4, Table 4).
11 The PISA study reveals the effects and the effec-
tiveness of such a tracking of life chances: the
average level of competences is quite different
for schools for disabled people (‘Sonderschule’),
grade school (‘Hauptschule’), middle school
(‘Mittelschule’) and Gymnasium (on the distri-
bution of competences among the tracks see
German PISA, 2001: 120–7).
12 Schmidt (2002: 17f.) outlines a bundle of nine
causation complexes responsible for meagre
German investments into education: (1) German
investments into private education (the dual
system, financed substantially by the private
sector!) that are above average in the country
sample; (2) age cohorts in the education phase
are too small; (3) tertiary educational participa-
tion is only weakly developed; (4) the indirect
effect of the confessional composition of the
population; (5) the medium strength of the
unions and the social partnership tradition
of both employers and unions to cultivate the
middle ground in the school system and
especially in the occupational qualification
system; (6) the party composition of the govern-
ments; (7) the political competition between two
large welfare state parties (CDU and SPD) that
assures priority for social security against
education if means are scarce; (8) a federalism
that constrains education expenditures due to
the structure of financing Länder budgets; and
(9) the permanent competition between differ-
ent policies for a share of the public budget, in
which the education system is disadvantaged
because it has little market power, low lobby
power and is not well represented in the
electorate. But see also Heidenheimer (1996).
13 There is a controversy over the relationship
between the development of expenditures and
students’ competences: Gundlach et al. (2001)
see an OECD-wide ‘collapse of productivity’,
with teachers and their salaries being the real
winners (see also Schmidt, 2002: 9), while
Glennerster (2001: 19), at least for the UK in the
last five years, sees a ‘productivity explosion’,
with students being the main winners.
14 Stephan Leibfried and Herbert Obinger are
presently editing a six-country comparison of
‘Federalism and Social Policy. Comparative
Perspectives on the Old and New Politics of the
Welfare State’ (to appear in 2004) in which this
topic is explored further.
15 This even takes the form of overlapping reform
paroles. In social assistance, attention paid to the
labour market is enforced by an ‘activating
welfare state’, which is about ‘Support and Strict
Requirements’ (‘Fördern und Fordern’), advo-
cated by Roland Koch (CDU Prime Minister in
Hesse) to Florian Gerster (former SPD Minister
for Social Affairs in Rhineland Palatia, who in
2002 became the head of Germany’s national
unemployment insurance scheme). PISA has now
applied this to education, for example in Hesse
(Wenz et al., 2001: 4th par.).
16 This explains why the press, when reporting on
the First National Poverty Report of the federal
government (BMA, 2001) in April and May
2001, often alluded to inheritance and estate
taxes. They saw the Poverty Report as an over-
ture to taxing the rich. 
17 As Howard Glennerster pointed out to us:
Scotland always had its own different system of
education – including different types of schools,
curricula and exams.
18 This ‘horizontal tracking’ may also be cracked
by starting school at an earlier age: in the
Anglo–Saxon world children generally start
school when they are 4–5 years old, whereas in
Education and the welfare state 79
Journal of European Social Policy 2003 13 (1)
most continental European and Scandinavian
countries the starting age is 6–7. This may also
be relevant to explaining PISA results.
19 We are grateful to Karin Gottschall for pointing
this out to us.
20 East Asian development is more clearly fixated
on the human capital approach (Schmidt, 2002:
6; Rieger and Leibfried, forthcoming: ch. 5). But
such a pathway is beyond Germany’s choosing
as it would imply a Gestaltswitch amounting to
a cultural revolution.
21 The traditional line continues with ‘. . . is the
army [ist die Armee]’. 
22 As Howard Glennerster pointed out to us, there
are significant regional variations in achievement
levels not just between the countries of the UK
but also within England. Scotland and Wales
have traditionally done better than England (and
have also spent more on their children in school)
But the South East of England has done better
than the old industrial North. 
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