Theoretical background

Abstract

In the following theoretical section, the concept of risk — a central notion of this paper — moves to the centre of analysis. It is assumed that non-standard employment situations are connected with a higher degree of risk concerning employment stability and security of unemployment. In this context, the achievement of ‘flexicurity’ would imply creating supply side incentives to take up non-standard employment by absorbing the additional risks through a range of inclusive security measures. Additionally, a condensed insight into segmentation theories is given. The standard prerequisites of secondary sector employment — high labour turn-over, low upward mobility and general insecurity — are at least partly fulfilled by non-standard employment. Especially the recent supply-side focussed advances of the theory seem useful for shedding light on risky employment situations. A large part of the theoretical section is concerned with insurance theory. First, the general rationale of installing institutions such as unemployment insurance is assessed. The discussion will then turn to the advantages and downsides of publicly organized unemployment insurance. Furthermore, voluntary and compulsory insurance, contributory financing and tax financing and the resulting predominance of either the equivalence or the welfare principle will be contrasted. Under the assumption that adequate unemployment insurance benefits for non-standard employed require redistribution efforts the possible trade-offs between efficiency and equity are addressed. In the final part of the theoretical section, welfare state theory is revised, enabling a better understanding of the underlying systems of the countries under analysis. 10 The other social science perspectives on risk mentioned are: identifying and explaining public concerns associated with the risk source; designing procedures to incorporate these cultural values into the decision-making process; designing participative programmes aiming at joint decision making; designing programmes for evaluating risk management performance and organisation structures for identifying, monitoring and controlling risks.