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This article examines the political determinants of the variations in active labour market policies across advanced democracies. Specifically, it investigates the conditions under which a welfare state accommodates rather than disregards the interests of labour market outsiders. Relying on the literature on post-industrial electoral realignment, this article argues that ideological orientations not only in socio-economic but also in sociocultural dimensions dictate the policy preferences of political parties for labour market programmes. This study then hypothesizes that libertarian governments are more likely than authoritarian governments to support human capital formation of labour market outsiders. An analysis of cabinet-based periodization data of 21 advanced industrialized countries from 1985 to 2017 shows that left- and right-libertarian governments favour public spending on active labour market programmes, thereby supporting this study’s hypothesis. Furthermore, it also reveals that while left-libertarian governments increase expenditures for direct job creation schemes, right-libertarian ones do so for employment assistance and training programmes.

Linking electoral realignment to welfare politics: an assessment of partisan effects on active labour market policy in post-industrial democracies