An international group of researchers propose a new, more sustainable approach for welfare states to update their policies. The approach focuses on social investments and interventions, emphasising the monitoring and adaptation of the measures according to their effectiveness throughout their lifecycles. The researchers present the approach in a newly published open-access book.

The Nordic welfare states are known for their welfare model, which combines social protection with economic growth, emphasising universalism, strong public services, and inclusive social policies. Nordic countries have been the forerunners of implementing social investment thinking in their welfare policies, and it has become a dominant approach in other European countries as well.

Yet as demographic change, economic strain, and technological transformation make societies more complex, it is increasingly clear that this framework must be updated and expanded to meet both longstanding and emerging challenges and expectations.

An international group of researchers now suggest a new approach for the welfare state calling for decision-making where preventive and corrective, short- and long-term policy measures are based more comprehensively on researched information and systematic evaluation of their effectiveness. The researchers identified elements that link successful welfare policies in terms of health care, education and social security.

The approach is based on extensive and sustained research at the INVEST Research Flagship Centre of Inequalities, Interventions and New Welfare State. INVEST is a joint centre of the University of Turku and Finnish Institute for Health and Welfare, funded by the Research Council of Finland.

Years of dedicated research have now been comprised to the newly published open-access book Beyond the Nordic Welfare State - Extending Social Investments with Interventions by editors Jani Erola, Pasi Moisio and Johanna Peltoniemi.

Combining theoretical contributions, comparative studies and Finnish case analyses, the book provides clear insights into how interventions can generate long-term benefits for individuals and society. It offers researchers, policymakers, and practitioners a timely perspective on renewing and strengthening welfare states in Europe and beyond.

Decision-making should extend to impact evaluation

The new approach challenges policy-makers to choose more targeted solutions to welfare policies.

“We need clear criteria for why a particular measure is chosen, what it is expected to change, and what indicators will be used to assess its success. This will allow us to allocate limited resources in a sustainable manner," says Professor of Sociology and Director of INVEST Research Flagship Centre Jani Erola from the University of Turku in Finland. He continues:

“In Finland, for example, a great deal of policy action is still taken without systematic monitoring. A functioning welfare state requires committed political decision-making. However, there is often no agreement on what to do if a measure does not achieve the desired objectives, or a return to evaluating its implementation. We need clearer division of responsibilities in decision-making.”

Erola points out that, in recent years, impact evaluation has become possible in a new way in welfare policy, enabled by rapid technological progress and digitalisation.

Short and long-term policies to complement each other

The new model for decision-making is based on social investment thinking, which has been the leading approach to welfare policy in the European Union for more than two decades. In it, welfare policy is viewed as a public investment in human capital and positive life transitions.

“Policy actions aim to strengthen skills, competence and inclusion so that individuals are able to make full use of education opportunities, the labour market, and other institutions at different stages of their lives," says Research Professor Pasi Moisio from the Finnish Institute for Health and Welfare.

The developed approach combines forward-looking social investments in a new way with short-term, targeted measures or interventions. Interventions address problems that require a rapid response. By looking at investments and interventions as a whole, both the problems and their root causes can be tackled more effectively.

“In practice, Finland has been applying individual elements of the investment and intervention-based welfare policies for a long time. For instance, education and early childhood education are key investments in a welfare state. The KiVa Antibullying Program for schools and the Housing First principle for mitigating homelessness are internationally renowned examples of interventions that, when implemented correctly, produce measurable well-being,” says Senior Researcher, Docent Johanna Peltoniemi from the Finnish Institute for Health and Welfare.

In Finland, the topic is exceptionally timely.

“We will have parliamentary elections in a year’s time and one of the key themes will be balancing the sustainability of the welfare state and social security,” Peltoniemi points out.

Jani Erola concludes that “an ageing population and the resulting reduction in resources are putting pressure on all welfare states to make decisions that are effective but fair. Our new approach provides a clear framework for achieving this."