Welfare State Institutions and Welfare State Attitudes: Using Privatization to Gain Causal Leverage on the Problem of Attitude Formation

Health care systems are under considerable strain owing to population aging, fiscal consolidation, migration, increasing inequality, and both Europeanization and globalization. Here, policy-makers face a quandary: how can one constrain health care spending, and yet satisfy public demands on the health system? Does privatization generate more resources for the public health system? Or, does it undermine the public sector by disintegrating social solidarity? This paper examines the relationship between the changing public-private boundary in health care and social solidarity. In contrast to other studies, we examine the individual attitudes of people who take out private health insurance. We base our analysis on the longitudinal German Socio-Economic Panel Study (GSOEP). First difference models are used to test the causal effect of private insurance on solidarity, while

multinomial logistic models examine whether social solidarity is a predict of switching to primary private insurance or buying supplementary private insurance. We can demonstrate that persons that switch to private health insurance or buy supplementary private

insurance become less supportive of government provision of health care than those who keep their primary public insurance.  Indeed, there is evidence that those that switched from public to private insurance were less solidaristic to begin with. Nevertheless, even if we control for previous attitudes, those that switch become even less solidaristic after switching. Those who buy supplementary private insurance on top of their public insurance also become less solidaristic although they were as solidaristic as those who kept their primary public insurance.