Social Investment and Territorial Inequalities: Mapping Policies and Services in the Baltic States

by Jurga Bučaitė-Vilkė (Volume editor)
©2022 Edited Collection 246 Pages
Open Access


Drawing on recent research perspectives, the book discusses how social investment policies could be responsive to territorial inequalities in terms of better policy coordination, capacities, and institutional infrastructures’ adaptability to territorial needs. By combining theoretical notions about territorial cohesion, territorial development, and social investment, the book provides an argument for the “territorialization of social investment policy” in the case of Lithuania. The contributions of various authors encourage a different way of looking at the territorial sensitivity of welfare policy strategies implemented in advantaged developing areas and those which are disadvantaged peripheral territories.

Table Of Contents

  • Cover
  • Title
  • Copyright
  • About the editor
  • About the book
  • This eBook can be cited
  • Preface
  • Table of Contents
  • List of abbreviations
  • Introduction. Challenging territorial inequalities and social investment policies. Book scope and content (Jurga Bučaitė-Vilkė)
  • Part I Revising territories and social investment policy in Europe: Concepts, ideas and challenges
  • Chapter 1 Territorial cohesion, spatial justice and the social investment approach (Panagiotis Artelaris and George Mavrommatis)
  • Chapter 2 A social investment approach for place-sensitive services: What is the potential impact on territorial inequalities? (Ruggero Cefalo, Tatjana Boczy, Marta Cordini)
  • Part II Social investment policy challenge in a small-scale country: Interventions, governance and services provision in the Lithuanian case
  • Chapter 3 Territorial profiles: Spatial inequalities and the importance of socio-economic differences (Artūras Tereškinas, Viktorija Baranauskienė, Jurga Bučaitė-Vilkė)
  • Chapter 4 Promoting social investment policy through the development of early childhood education and care policy. The Lithuanian case1 (Aušra Maslauskaitė)
  • Chapter 5 Active labor market policies as a part of social investment approach (Artūras Tereškinas)
  • Chapter 6 Social investment and vocational education and training policy: The architecture of combining national standardization and territorial needs (Jurga Bučaitė-Vilkė)
  • Chapter 7 In summary: Is a social investment approach compatible with territories? Lessons to be learned (Jurga Bučaitė-Vilkė)
  • List of Figures
  • List of Tables
  • About the authors
  • Series index

Jurga Bučaitė-Vilkė

Introduction. Challenging territorial inequalities and social investment policies. Book scope and content

Fuzzy concepts: Territorial differences, territorial cohesion, and social investment policy turn

In 2013 the EU launched the Social Investment Package for Growth and Social Cohesion (European Commission, 2013) to underline the importance of welfare reform policies and respond to growing social, economic, and technological risks in the turn towards expanding social investment policies. Together with the historical Lisbon Agenda (2000), this was a political call to convert Europe into the “most competitive and dynamic knowledge-based economy in the world, capable of sustainable economic growth and more and better jobs and greater social cohesion” (European Council, 2005) and became an indivisible part of reforming national European welfare policies. In academic debate, and in the light of an urgent need for welfare reforms, the emergence of a European Social Model became a background for a re-conceptualization of the role of state and market allocation mechanisms. Social investment as a paradigm was well developed in the academic discussions elaborated by Vandenbroucke, Vleminckx, 2011, Morel et al. (2012), and Hemerijck (2014, 2017) and many more. The determination to overcome the byproducts of demographic change; growing social disparities, the need for sustainable economic growth and increasing labor productivity, has redirected most European countries towards welfare modernization. There is strong empirical evidence that social investment has significantly modified national welfare systems, especially in fostering labor force participation, in revising social spendings, fostering the dual family earner model, and expansion of public services (Nolan, 2013; Hemerijck, 2014, 2017). Further academic arguments emphasize social investment as a political platform to reconsider social spending and its economic effectiveness. The main question here is whether social spending is constructed as a welfare investment that eventually results in higher economic performance, labor productivity and increased human capacities, or treated as simply economic expenses (Morel et al., 2012).

In this book we adhere to the idea that social investment reflects the turnaround in conceptual and analytical policy frameworks that effectively relate ←11 | 12→social risks and policy responses. Therefore, mobilization and governance structure are important to enable welfare policy implementation (Hall, 1993). Scholars underline the multidimensionality of the social investment perspective that effectively contributes to growth and social inclusion. In addition, the social investment paradigm includes a complex policy mix across different fields, for example, labor market, education, social benefits transfer systems, parenting and family services, elderly care, and gender policies (Heckman, 2006; Solga, 2014; Schindler et al., 2015; Garritzmann et al., 2018 and many others). Hemerijck (2017) based on his long-term commitment to welfare state analysis, summarizes social investment as effecting considerable interventions in three “productive” policy functions: (1) “raising the quality of the ‘stock’ of human capital and capabilities over the life-course; (2) easing the ‘flow’ of contemporary labor-market and life-course transitions; and (3) maintaining strong minimum-income universal safety nets as income protection and economic stabilization ‘buffers’ in ageing societies” (Hemerijck, 2017, p. 19). The importance of strengthening skills and competencies, enhancing productivity over the course of a lifetime, efficiently allocating labor resources and securing income protection and economic stability, define the core of the social investment paradigm (Hemerijck & Vandenbroucke, 2012; Hemerijck, 2014, 2015). What is important for this book is the need for institutional complementaries that are associated with different policy provisions that complement each other. Referring to Hemerijck (2017), isolated social investment policy innovations do not achieve a positive effect if not provided as policy synergy. On the contrary, social investment tools without a systematic approach risk becoming counterproductive and costly, especially in terms of cost-benefit analysis. For example, the implementation of an effective childcare provision system should be accompanied by a comprehensive employment policy for both parents, especially for low skilled and low-income females as well as an overall social protection system (Van Lancker, 2013).

Secondly, an important analytical dimension of the book is a multi-layered concept of territory and territorial inequalities that derive from the conceptual and empirical findings by social and economic geographers, urban planners, political scientists, and urban sociologists. A social investment policy paradigm has been the inspiration to look differently at territorial inequalities that have experienced a resurgence in national states on a different scale from regional or local levels. Therefore, policy awareness of emerging territorial cohesion complements the discussion on a so-called “European social model” that appeals to the values of social welfare, equity, sustainability and good governance. As documented in the growing body of academic literature, the concept of territorial cohesion is employed as an alternative in order to raise awareness of the relationship between spatial inequalities and ←12 | 13→social-economic growth. In general, territorial cohesion policy that entails the reference to spatial dimensions proposes rather fuzzy policy-making tools that require new decisions on territorial interdependence (Faludi, 2007a). With reference to Faludi, we should be more concerned about “equity, competitiveness, sustainability, and good governance”. Following his assertion, territorial cohesion can balance these ideas on spatial scales where a balancing act is needed to reconcile the divergent interests of stakeholders (Faludi, 2007b, p. 25). Despite the diversity of opinion among political advocates as to how territorial cohesion should be reinforced, there is common agreement about the need for a certain level of decommodification as a part of social rights (Faludi, 2007a; Esping-Andersen, 1990). Beyond the classical understanding of decommodification (Esping-Andersen, 1990), it also includes the aspects of quality of life in territories, as for example, public interventions in service provision or urban planning, values, and lifestyles.

In responding to intensive advocacy of sustainable territorial social-economic growth and the need for better territorial equalization, a few challenges arise. The first issue is related to the reduced capacity of a national welfare state to respond sufficiently to territorial disbalances and spatial differentiation problems. The emergence of new social risks, including income inequality, social exclusion, new employment patterns and technological change calls for better “contextualization” of welfare provisions. There is currently much evidence that European regions have become more polarized regarding social and economic development aspects (Puga, 2002; Charron, 2016; Rodrıguez-Pose, 2018). Referring to Andre Rodrıguez-Pose (2018), there are places that matter and places that do not. The largest cities are characterized by a growing population and industries that reflect economic productivity, growing technological hubs, greater skills and growth accumulations. In contrast, rural areas and declining industrialized regions present a picture of declining labor productivity, de-population, social exclusion and social stigma, and lower household incomes. Therefore, by territorial inequalities are treated as irrelevant regarding low-income and low-density places. Remote territories are treated as places of inefficient return of economic development policies and globalization (Glaeser & Gottlieb, 2009; Kline & Moretti, 2014; Rodrıguez-Pose, 2018). In this respect income-support transfers and benefits to sustain employability are used as principal welfare instruments to achieve economic effectiveness. However, the statistical data from different countries demonstrates that misguided investments result in inadequate regional development where unemployment, reliance on in-kind support and weak competitiveness remain a main issue (Fratesi & Rodríguez-Pose, 2016). The misleading reference is that lagging-behind areas have no potential that leads to miscalculation of territorial assets (Barca et al., 2012).←13 | 14→

The second issue concerns institutional inability to provide policy solutions for territorial equalization. These concerns address the issue of policy interventions asking at what level should policies intervene in territorial development. There are many reasons and trade-offs explaining the inadequate policy response to the needs of vulnerable territories, for example, imbalance between multilevel coordination and governance levels, low impact interventions, and focus on income-support transfers, politicization of territorial inequalities, and the overlooking of economic and social potential of lagging-behind territories. Institutional quality may also reflect the tensions in implementing effective territorial interventions in terms of competitiveness, capacity to innovate, limits in accountability amongst other issues (Charron et al., 2014; Rodríguez-Pose & Di Cataldo, 2015; Rodríguez-Pose & Garcilazo, 2015). It is obvious that growing regional disparities require a recalibration of public policies addressing territorial social and economic inequalities more effectively than traditional so-called spatially blind policies (Iammarino et al., 2019). One of the possible solutions is place-sensitive policies that better address the territorial capacities especially when left-behind territories are provided with right endowments and infrastructures (Iammarino et al., 2017). On the one hand, regional inequalities and social exclusion work as complementary mechanisms. Low quality institutions and poor connectivity act as stimulating mechanisms for higher levels of territorial disparities as well. As Lammarino et al. (2019, p. 288) summarize, the ambivalence of a place-sensitive approach stating that “too much focus on efficiency through agglomeration may therefore enhance territorial inequity (which, in turn, undermines efficiency), while too much focus on equity through place-based support (without development) undermines overall economic efficiency”. Finally, maximization of territorial potential and development of capabilities could provide a framework for the different spatial development patterns of territories whether urban or rural. Advocacy of a place-based policy framework could indicate the agenda for implementing social investment policies that mobilize territorial capacities with institutional endowments. Coordination of top-down instruments and bottom-up initiatives lead to the development of a place-sensitive theoretical framework underpinning the conventional policy tools (Iammarino et al., 2019).


ISBN (Hardcover)
Open Access
Publication date
2022 (May)
Berlin, Bern, Bruxelles, New York, Oxford, Warszawa, Wien, 2022. 246 pp., 28 fig. b/w, 18 tables.

Biographical notes

Jurga Bučaitė-Vilkė (Volume editor)

Jurga Bucˇaite˙-Vilke˙ is an associate professor in the Department of Sociology, at Vytautas Magnus University, Lithuania. Her long-running research interests include local governance, participatory and representative democracy, community development and social policy areas. She has published several articles and chapters on local democracy, municipal governance and public services.


Title: Social Investment and Territorial Inequalities: Mapping Policies and Services in the Baltic States
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248 pages