Conference of the International Journal of Arts and Sciences 1(18): 143 - 153 (2009) CD-ROM. ISSN: 1943-6114 © InternationalJournal.org Estonian Social Model in a Comparative Context Kaire Poder, University of Technology, Estonia Kaie Kerem, University of Technology, Estonia Abstract: We show that recent geographical divisions of the European Social Model (ESM) – Nordic, Anglo-Saxon, Mediterranean and Continental – basically follow the Esping- Andersen’s (1990) welfare regime typology. Esping-Andersen’s criteria of decommidification and stratification create the following typologies of the welfare states: – liberal, conservative- corporatist and social democratic. To compare “Estonian social model” we focus on seven countries. In addition to Estonia three Nordic countries are chosen – Finland, Sweden and Norway – as the best representatives of Nordic tradition of welfare state. Another three countries – USA, UK and Ireland – are stated as examples of liberal welfare state and often regarded as counter-examples of Nordics. We use the comparative analysis to compile scaled variables of certain countries that measure decommodification (10 variables) and stratification (6 variables). All data cover averages of the period 2000 to 2007. According to our results social democratic Nordic countries have low stratification and high decommodificaton scores compared to Anglo-American liberal regimes. In general “Estonian social model” is even “more liberal” than typical representatives of this typology. So we argue that future policy choices cannot be justified by just following a certain type of “social model”. Based on the empirical results, we dispute that Estonian social policy choices are rather normative, although there is some positive economic theory indicating that a welfare state can enhance efficiency only when its welfare system creates institutions that heal market failures. 1. Introduction Ever since its appearance in 1990, Esping-Andersen’s typology of welfare regimes (Esping- Andersen 1990) has been a subject of both praise and criticisms. In extreme Baldwin (1996: 29) states that ‘typologizing (...) is the lowest form of intellectual endeavour’. Nevertheless, in addition to the criticism on the scholarly activity of creating typologies as such, also a wide variety of competing typologies and additions have been proposed. In the 1990s political contest between the ‘Anglo-American model’ of liberalized markets lacking a social dimension, and an inflexible ‘European social model’ (ESM) of generous welfare provision, but slow growth and high unemployment, has started. After the transition of post-soviets some extensions of ‘post-soviet type’ appeared, which contributed even more to the political choices over social spheres. This article examines to what extent the ‘Estonian social model’ fits into Esping-Andersen’s typology and what the differences are between Estonian, Nordic (also called Scandinavian) and Anglo-Saxon (Anglo-American) social models. Also Sapir’s (2005) hypothesis that the Nordic model affords equity without sacrificing efficiency is checked and rejected. For these typologies of different traditions, welfare state classifications and ESMs are compared; and the economic efficiency of both traditions is assessed. Instead of creating new typologies or criticizing old ones, we aim at typologizing the ‘Estonian model’ by constructing