The welfare state approach and tax policies in welfare state countries

The end of the 18th century and the beginning of the 19th century have important events in terms of human history. With the French Revolution, nation-states began to be destroyed and led to the establishment of new states instead. In the future, the process accelerated with the Industrial Revolution. Following the industrial revolution, production accelerated. The need for labor power decreased with mechanization. As a result, there has been an increase in unemployment rates. The existence of the unemployed in question increased the pressure of capital on labor. Due to the low wages and difficult conditions of the workers, the states granted some social rights in order to improve the conditions of the working class and to ensure the survival of the non-working groups. This is one of the first steps taken in the formation of today's welfare states. The Great Depression of 1929 led to a new chapter in the history of economics. The liberal economic theory, which was accepted and applied until the crisis in question, could not cure the crisis. Thus, as J.M.Keynes, one of the most important economists of that period, stated that the thesis that the state should not stay away from the market and intervene in the economy began to be accepted. In this context, the state has become more active in the economy. The existence of the public sector as well as the private sector in the economy has changed the market balance in favor of labor. Social benefits given to employees have improved working and living conditions. After the Second World War, the need for a welfare state increased. The welfare state lived its golden age between 1945-1970. But the oil crisis of the 1970s caused Keynesian policies to be shaken. Then, with the globalization spreading all over the world, the concept of interventionist state was damaged. As a result, the understanding of the welfare state has not changed completely but has been drastically and experienced a change. Keywords: Welfare State, Tax Policies, Social Services.