Academic literature on the topic 'Welfare state – history'

‘CRISIS? WHAT CRISIS?’, THE CHANCELLOR OF THE EXCHEQUER was reported to have replied to a question concerning the alleged crisis in sterling. In the case of the welfare state it might seem that the appropriate response would be ‘Which crisis? ’ since there are several on the menu - fiscal crisis, legitimacy crisis, crisis of ungovernability . Left, Right and Centre have become convinced that there is a crisis. This is after a period of history which had seen an unprecedented rise in the standard of living of the vast majority of the population living in what are normally regarded as welfare states.

Histories of American welfare have been stories about the state. Like Walter Trattner's widely read From Poor Law to Welfare State, now in its sixth edition, they have offered a narrative about the slow but steady expansion and elaboration of state and federal protections granted to poor and working people, and have usually done so by charting increases in government expenditures, by documenting the institutionalization of welfare bureaucracies, and by tracing rises or declines in poverty, unemployment, and other aggregate measures of well-being. This has been the case even in more critical accounts that emphasize that American social welfare history is not a story just of progress, such as Michael Katz's In the Shadow of the Poorhouse. These narratives have emphasized programs, not people (whether it is the poorhouse, the asylum, and mother's pensions, or the more recent innovations of national unemployment insurance, Social Security, AFDC and TANF, and Medicare and Medicaid). In the investigations of the welfare state that dominate academic research, the content and timing of government policy itself has served as the dependent variable, while the independent variables have been a congeries of interests, institutions, and policy entrepreneurs. Our attention has been focused upon what government has done, why it was done, and what the effects were as measured in official data.

This thesis shows the build-up of a society in the golden days of the welfare state of Sweden. Stråssa, a small society built up around one big employer – the mine, owned by the Grängesbergsbolaget – is used as a case-study, put in the larger perspective of the welfare state and its values. The mine was re-opened in 1959 and the research period is 1949-1965. This research has three layers, (1) the welfare state (2) the municipality and the company and (3) the citizens.  The research shows how the foundry spirit lives longer than expected in the welfare state during a period when the municipality has gotten great responsibilities by the state. Here the municipality and the citizens still have expectations on the big employer of the area to finance the build-up, both regarding the housing- and the leisure time-questions, responsibilities that were put on the municipalities under this era.

The purpose of this paper is to analyze the series of events and legislation that has led to the current system of welfare and wealth redistribution in the United State. I begin with a background of the origins of the welfare state in England and the United States, and discuss the social movements which gave rise to the modern welfare state. I discuss how wars, economic theories, and recessions have influenced policy, and how such policy has affected poverty and unemployment rates since the Great Depression. I have found that social welfare spending has steadily increased since the Great Depression, and that the current trend of deficit spending and expansion of the social safety-net is a product of the legislation passed during the Great Depression and the ‘Great Society’ of the 1960s. Although there have been many attempts to secure a minimum standard of living through social welfare spending, the problems of poverty and unemployment persist.

The New Right's critique of the welfare state has generated considerable interest in the history of alternative forms of welfare provision. Recent work has focused upon the continued existence of voluntarism alongside the growth of twentieth century state welfare. In doing this, it has reacted against the tendency of post-war social welfare writing to concentrate exclusively on the statutory social services. This thesis, therefore, adds to a growing body of writing on inter-war voluntary social action. However, it differs from the work of others by focusing upon the interplay of voluntary and statutory sectors in the face of war, industrial unrest and mass unemployment: in other words the upheavals of the early twentieth century. The main body of the research not only deals with the part played by both sectors in the delivery of social services, but also places voluntarism in a wider social context by exploring its ideological response to working-class assertiveness. Indeed, the belief in a British national community with interests that transcended class or sectional divisions was a common feature in voluntarism's attitude towards the above challenges and their implications for social stability. Thus, by highlighting the class objectives of the middle-class volunteer, this thesis avoids treating voluntary groups as simply the deliverers of social services in partnership with the state. As middle-class organisations operating within civil society, the charities covered in the pages ahead are placed alongside the state and capital in the defence of the existing economic and social order. Differences may have existed amongst charities over the correct mix in the statutory-voluntary welfare mix, but, as this thesis seeks to prove, this should not blind us to voluntarism's commitment to an over riding class interest.

This is a study of eighteenth-century local care networks in Charlestown, Massachusetts. The letters and petitions of desperate women and men document the channels those in need travelled. Details of sufferers' lives and their interactions with town authorities and care providers illuminate community-based relief pathways. Mapping the geography of poor relief through the experiences of individuals illuminate vibrant networks of local relief channels that sufferers not only knew about, but contributed to in an active way.

This thesis is about the spa town of Bad Ems in West Germany - its social and economic development. It analyses the town's rise to fame as a fashionable centre for relaxation and recuperation and the emergence of a 'spa culture' in the nineteenth century. It also studies the impact of the gradual 'democratisation' of cures i.e. how spa towns like Bad Ems changed in this century with the increase in the number of cure-guests funded by the statutory insurance bodies. This inevitably involves an examination of the system of national health provision from the late 19th century and the incorporation of spa treatment into benefit schemes. The subsequent analysis of medical knowledge and opinion, with particular reference to spa remedies and treatment considers both medical practitioners in Bad Ems and the development of the science of balneology over the past one hundred and fifty years. This analysis includes the debates and arguments about the modern cure and the growing concern since the Second World War with the efficiency and effectiveness of social insurance cures. Finally, this study looks at the cure-takers themselves, both in their relationship with the medical profession and their experience of spa life. Because no comprehensive study of Germany's spas has been attempted, this thesis aims to bring together different perspectives adopted by various disciplines. However, given the present state of research, it seemed that the only viable approach would be through a case study which analyses the town of Bad Ems at a grass-root level, though without ignoring the impact of national events and policies in Germany on cure-taking and spa culture. The findings of the research indicate that the introduction of cures as a benefit of national welfare policies ensured the survival of spas as health centres. No less importantly, today a cure is no longer the preserve of a wealthy elite as in the 19th century but available to all Germans. The success of cures in Germany today would also seem to reflect a culturally specific attitude to health and illness which stands in marked contrast to that in this country where spas have declined and where there is little interest in the forms of treatment offered by mineral springs and thermal waters.

This report provides an extensive overview of the history of the Swedish pension system. Starting with the implementation of the world's first universal public pension system in 1913, the report discusses the political as well as the economic background to each major public pension reform up until today. It presents the rules and the institutional details of these reforms and discuss their implications for retirement behavior, the general state of the economy and the political environment. Parallel to the development of the public pension system, a comprehensive and quite complex occupational pension system has emerged. This report describes the historical background and the institutional details of the four largest agreement-based occupational pension schemes in Sweden.

The primary question at issue in this paper is the following: given the similarities between the two countries with regard to welfare state institutions, why have the United States and the United Kingdom diverged on the issue of health care? Drawing on sociological institutionalism, a branch of the new institutionalist paradigm, this paper provides an answer to this question: during the formative years of the health care stories in the two countries, variations in institutional and cultural conditions produced contrasting policy outcomes. More specifically, this paper discusses how the combination of institutions (political, labor, and medical) and culture led to private insurance in the United States and public insurance in the United Kingdom. Of course, this paper has implications for several areas of scholarship, as well as for current policy debates on a wide range of issues.

AbstractIn this introductory chapter, Annola, Lindberg, and Markkola introduce the theoretical and historiographical foundations of the book. The authors contextualize the history of experience in the traditions of new social history, cultural and linguistic turns, the German Erfahrungsgeschichte, and the history of emotions and senses. Focusing on institutions introduced by the state and developed by the welfare state mainly in the area surrounding the Baltic Sea, the chapter shows the various ways in which institutions that have shaped people’s everyday lives can be studied. By combining the history of experiences with the history of the welfare state and institutional studies, the chapter seeks new ways to understand how institutions have produced, reinforced, and sometimes prevented various experiences. The concept “lived institutions” is used to illuminate the interconnections between experience and welfare institutions and the ways in which these mutual connections are related to societal change. The introduction ends with a chapter-by-chapter outline of the book.

Abstract. Dyvosvit University of the Third Age is a joint project of the Department of Labour and Social Protection of the Population of Uman City Council and Pavlo Tychyna Uman Pedagogical University. The main goal is to implement the principle of lifelong learning of elderly people and support physical, psychological, and social abilities. Its task is to provide educational services, attract the elderly to an active social life, preserve their physical, mental, and spiritual health, learn the history of their native land, information technology, etc. The University hosts: the Faculty of Local History Education and Organization of Recreation and Tourism; the Faculty of Humanities and Law Education; the Faculty of Applied and Decorative Arts; the Faculty of Folk Singing; the Faculty of Computer Competence. The provision of such an educational service should ensure: arrangement of conditions for and promotion of holistic development of elderly people; reintegration of elderly people into the active life of society; assistance to elderly people in adapting to modern living conditions by mastering new knowledge, in particular on the ageing process and its features; modern methods of preserving health; acquisition of self-help skills; shaping of the principles of a healthy lifestyle; the framework legislation regarding elderly people and its application in practice; shaping and development of skills for using the latest technologies, primarily information and communication technologies; potential and opportunities for volunteer work; improving the quality of life of elderly people by providing them with access to state-of-the-art technologies and adapting them to technological transformations; development of practical skills; opportunity to expand communication and exchange experience. Keywords: social service, elderly people, lifelong learning, university of the third age.

Throughout the human history, many leaders such as presidents, kings, sultans, emirs, shahs, and khans have lived. Looking back to the age of globalization, it is evident that leaders with global qualities and encompassing capabilities were few. Zahirad-Din Muhammad Babur Shah Ghazi stands out as aleader with developed personality, strategic genius, beautiful moral character, superior talents, fair governance of different elements, ruling with justice, avoiding oppression, developing society, building prosperous cities, and embodying virtues like love and mercy. Babur Shah is the founder of the Muslim Turk-Hind Empire that sustained a great civilization on the lands of India for centuries, altering the fate and history of Asia. In the age of globalization, human relationships, intercultural interactions, coexistence of differences, and the rise of multicultural societies have led humanity to a new era. Centuries ago, Babur Shah arrived from Transoxiana to the Indian subcontinent, confronting the realities of the age of globalization and governing people of different religions, races, cultures, and affiliations with peace and justice. He developed society, spread prosperity, established a welfare state, and stayed away from exploitation. He did not transfer the country's resources elsewhere, nor did hesteal or take anything for himself; instead, he invested and utilized the gains, resources, and wealth in service to those lands. He can be seen as a global leader and exemplar for humanity and societies living in the age of globalization.

Both academia and popular culture have neglected the movement of Scandinavian Postmodern architecture (ca. 1975-1990), a tradition eclipsed by Modernism as the prevailing aesthetic and social project in Scandinavia. In light of the last decade of Postmodernism’s resurgence in the architectural academy globally, and recent uses of Postmodern architectural principles by right-wing movements in Europe, it is a crucial time to revisit this obscured regional Postmodernism. The movement of Scandinavian Postmodern architecture coincided with political shifts in the region which were supported by both the right and left of the political spectrum causing a shared space of conflict and imagination. The political dimensions of Scandinavian Postmodernism will be explored primarily through a close reading of Danish Postmodern Architect and Writer Ernst Lohse’s 1986 manifesto “Our Construction Should be Based in the Irrational” (translated into English for the first time for this paper), where, despite Lohse’s own sympathy for the environmental movement, he adopts familiar conservative rhetoric, bemoaning the loss of Western culture and the limitations of the welfare state. This paper will reconstruct the obscured history of Scandinavian Postmodernism, using the case of Ernst Lohse to locate discourse that reveals the movement as a site of contention and overlap between diverging political groups and its particular appeal to the conservative imagination.

Trade liberalization is one of the greatest economic arguments of the economics and it is claimed that trade openness is a crucial phenomenon for the well-being of nations since Adam Smith. Although various practices have been seen in different parts of the world in the history, from 1980s trade liberalization movements have been the dominant trend. However liberalization of trade in developing countries brought debates in economic literature and it is argued that open trade can have catastrophic effects instead of providing growth and welfare to the practitioner countries. In this study if The Black Sea Economic Cooperation Organization had contributed the member states to liberalize their trade has been investigated. The changes in the rates of inward and outward investment, import, export, population and labour force of the member countries during the establishment period of the Organization has been evaluated. The data is collected from Worldbank National Accounts Database, IMF World Economic Outlook and Balance of Payments Database and UNCTAD. The results of the study has shown that although the establishment of the organization had positive effect on investment and trade flows of the countries, it had no effect on labour flows of the member states.

On behalf of the Happiness University Network, we are pleased to present here an extract of the information concerning the universities working to generate the diffusion of this network. Specifically, with the support of the University of Salamanca and the Pontifical University of Salamanca the aim is to create a friendly and working environment for the dissemination and discussion of the latest scientific and practical developments in the fields of happiness economics, corporate wellbeing, happiness management and organisational communication. It also offers an opportunity for productive encounters, the promotion of collaborative projects and the encouragement of international networking. Below you will find papers related to: Economics of happiness, happiness management, organisational communication, welfare state economics, consumer happiness, leadership, social marketing, happiness management and SDGs, happiness management in human resource strategies, learning and competencies in happiness management, learning and competencies in social well-being, measurement and indicators of happiness and well-being and history of welfare economics.

It is conventional wisdom that: Continued fast growth in the BRICS will result in a rapid catch-up to match and even surpass Western income levels in the next few decades The crisis in Europe will soon be over and normal growth will then resume as if nothing had happened The tax competition resulting from globalization means a race to the bottom in which corporate tax rates fall dramatically everywhere The best way to escape the poverty trap is to give the poor more money Losers from globalization can be ignored by politicians in western democracies because they do not matter for electoral outcomes The adjustment problems for developing countries arising from the crisis are quite minor and easy to deal with Actually, as Reversals of Fortune shows, all of these beliefs are highly questionable. The research findings reported here provide economic analysis and evidence that challenge these claims. In the report, Nicholas Crafts asks: "What Difference does the Crisis make to Long-term West European Growth?" Vera Troeger considers "The Impact of Globalisation and Global Economic Crises on Social Cohesion and Attitudes towards Welfare State Policies in Developed Western Democracies." Stephen Broadberry looks at "The BRICs: What does Economic History say about their Growth Prospects?" Sharun Mukand takes "The View from the Developing World: Institutions, Global Shocks and Economic Adjustment." Finally, Sayantan Ghosal has a new perspective on "The Design of Pro-poor Policies."

Two recent papers by prominent antitrust scholars argue that a revived antitrust movement can help reverse the dramatic rise in economic inequality and the erosion of political democracy in the United States. Both papers rely on the legislative history of the key antitrust statutes to support their case. Not surprisingly, their recommendations have been met with alarm in some quarters and with skepticism in others. Such proposals by antitrust reformers are often contrasted with the Consumer Welfare Standard that pervades antitrust policy today. The Consumer Welfare Standard suffers from several defects: (1) It employs a narrow, unworkable measure of welfare; (2) It excludes important sources of welfare based on the assumption that antitrust seeks only to maximize wealth; (3) It assumes a constant and equal individual marginal utility of money; and (4) It is often combined with extraneous ideological goals. Even with these defects, however, if applied consistent with its theoretical underpinnings, the consideration of the transfer of labor rents resulting from a merger or dominant firm conduct is supported by the Consumer Welfare Standard. Moreover, even when only consumers (and not producers) are deemed relevant, the welfare of labor still should consistently be considered part of consumer welfare. In contrast, fostering political democracy—a prominent traditional antitrust goal that was jettisoned by the Chicago School—falls outside the Consumer Welfare Standard in any of its constructs. To undergird such important broader goals requires that the Consumer Welfare Standard be replaced with the General Welfare Standard. The General Welfare Standard consists of modern welfare economics modified to accommodate objective analyses of human welfare and purged of inconsistencies.

Banco de la República is celebrating its 100th anniversary in 2023. This is a very significant anniversary and one that provides an opportunity to highlight the contribution the Bank has made to the country’s development. Its track record as guarantor of monetary stability has established it as the one independent state institution that generates the greatest confidence among Colombians due to its transparency, management capabilities, and effective compliance with the central banking and cultural responsibilities entrusted to it by the Constitution and the Law. On a date as important as this, the Board of Directors of Banco de la República (BDBR) pays tribute to the generations of governors and officers whose commitment and dedication have contributed to the growth of this institution.1 Banco de la República’s mandate was confirmed in the National Constitutional Assembly of 1991 where the citizens had the opportunity to elect the seventy people who would have the task of drafting a new constitution. The leaders of the three political movements with the most votes were elected as chairs to the Assembly, and this tripartite presidency reflected the plurality and the need for consensus among the different political groups to move the reform forward. Among the issues considered, the National Constitutional Assembly gave special importance to monetary stability. That is why they decided to include central banking and to provide Banco de la República with the necessary autonomy to use the instruments for which they are responsible without interference from other authorities. The constituent members understood that ensuring price stability is a state duty and that the entity responsible for this task must be enshrined in the Constitution and have the technical capability and institutional autonomy necessary to adopt the decisions they deem appropriate to achieve this fundamental objective in coordination with the general economic policy. In particular, Article 373 established that “the State, through Banco de la República, shall ensure the maintenance of the purchasing power of the currency,” a provision that coincided with the central banking system adopted by countries that have been successful in controlling inflation. In 1999, in Ruling 481, the Constitutional Court stated that “the duty to maintain the purchasing power of the currency applies to not only the monetary, credit, and exchange authority, i.e., the Board of Banco de la República, but also those who have responsibilities in the formulation and implementation of the general economic policy of the country” and that “the basic constitutional purpose of Banco de la República is the protection of a sound currency. However, this authority must take the other economic objectives of state intervention such as full employment into consideration in their decisions since these functions must be coordinated with the general economic policy.” The reforms to Banco de la República agreed upon in the Constitutional Assembly of 1991 and in Act 31/1992 can be summarized in the following aspects: i) the Bank was assigned a specific mandate: to maintain the purchasing power of the currency in coordination with the general economic policy; ii) the BDBR was designatedas the monetary, foreign exchange, and credit authority; iii) the Bank and its Board of Directors were granted a significant degree of independence from the government; iv) the Bank was prohibited from granting credit to the private sector except in the case of the financial sector; v) established that in order to grant credit to the government, the unanimous vote of its Board of Directors was required except in the case of open market transactions; vi) determined that the legislature may, in no case, order credit quotas in favor of the State or individuals; vii) Congress was appointed, on behalf of society, as the main addressee of the Bank’s reporting exercise; and viii) the responsibility for inspection, surveillance, and control over Banco de la República was delegated to the President of the Republic. The members of the National Constitutional Assembly clearly understood that the benefits of low and stable inflation extend to the whole of society and contribute mto the smooth functioning of the economic system. Among the most important of these is that low inflation promotes the efficient use of productive resources by allowing relative prices to better guide the allocation of resources since this promotes economic growth and increases the welfare of the population. Likewise, low inflation reduces uncertainty about the expected return on investment and future asset prices. This increases the confidence of economic agents, facilitates long-term financing, and stimulates investment. Since the low-income population is unable to protect itself from inflation by diversifying its assets, and a high proportion of its income is concentrated in the purchase of food and other basic goods that are generally the most affected by inflationary shocks, low inflation avoids arbitrary redistribution of income and wealth.2 Moreover, low inflation facilitates wage negotiations, creates a good labor climate, and reduces the volatility of employment levels. Finally, low inflation helps to make the tax system more transparent and equitable by avoiding the distortions that inflation introduces into the value of assets and income that make up the tax base. From the monetary authority’s point of view, one of the most relevant benefits of low inflation is the credibility that economic agents acquire in inflation targeting, which turns it into an effective nominal anchor on price levels. Upon receiving its mandate, and using its autonomy, Banco de la República began to announce specific annual inflation targets as of 1992. Although the proposed inflation targets were not met precisely during this first stage, a downward trend in inflation was achieved that took it from 32.4% in 1990 to 16.7% in 1998. At that time, the exchange rate was kept within a band. This limited the effectiveness of monetary policy, which simultaneously sought to meet an inflation target and an exchange rate target. The Asian crisis spread to emerging economies and significantly affected the Colombian economy. The exchange rate came under strong pressure to depreciate as access to foreign financing was cut off under conditions of a high foreign imbalance. This, together with the lack of exchange rate flexibility, prevented a countercyclical monetary policy and led to a 4.2% contraction in GDP that year. In this context of economic slowdown, annual inflation fell to 9.2% at the end of 1999, thus falling below the 15% target set for that year. This episode fully revealed how costly it could be, in terms of economic activity, to have inflation and exchange rate targets simultaneously. Towards the end of 1999, Banco de la República announced the adoption of a new monetary policy regime called the Inflation Targeting Plan. This regime, known internationally as ‘Inflation Targeting,’ has been gaining increasing acceptance in developed countries, having been adopted in 1991 by New Zealand, Canada, and England, among others, and has achieved significant advances in the management of inflation without incurring costs in terms of economic activity. In Latin America, Brazil and Chile also adopted it in 1999. In the case of Colombia, the last remaining requirement to be fulfilled in order to adopt said policy was exchange rate flexibility. This was realized around September 1999, when the BDBR decided to abandon the exchange-rate bands to allow the exchange rate to be freely determined in the market.Consistent with the constitutional mandate, the fundamental objective of this new policy approach was “the achievement of an inflation target that contributes to maintaining output growth around its potential.”3 This potential capacity was understood as the GDP growth that the economy can obtain if it fully utilizes its productive resources. To meet this objective, monetary policy must of necessity play a countercyclical role in the economy. This is because when economic activity is below its potential and there are idle resources, the monetary authority can reduce the interest rate in the absence of inflationary pressure to stimulate the economy and, when output exceeds its potential capacity, raise it. This policy principle, which is immersed in the models for guiding the monetary policy stance, makes the following two objectives fully compatible in the medium term: meeting the inflation target and achieving a level of economic activity that is consistent with its productive capacity. To achieve this purpose, the inflation targeting system uses the money market interest rate (at which the central bank supplies primary liquidity to commercial banks) as the primary policy instrument. This replaced the quantity of money as an intermediate monetary policy target that Banco de la República, like several other central banks, had used for a long time. In the case of Colombia, the objective of the new monetary policy approach implied, in practical terms, that the recovery of the economy after the 1999 contraction should be achieved while complying with the decreasing inflation targets established by the BDBR. The accomplishment of this purpose was remarkable. In the first half of the first decade of the 2000s, economic activity recovered significantly and reached a growth rate of 6.8% in 2006. Meanwhile, inflation gradually declined in line with inflation targets. That was how the inflation rate went from 9.2% in 1999 to 4.5% in 2006, thus meeting the inflation target established for that year while GDP reached its potential level. After this balance was achieved in 2006, inflation rebounded to 5.7% in 2007, above the 4.0% target for that year due to the fact that the 7.5% GDP growth exceeded the potential capacity of the economy.4 After proving the effectiveness of the inflation targeting system in its first years of operation, this policy regime continued to consolidate as the BDBR and the technical staff gained experience in its management and state-of-the-art economic models were incorporated to diagnose the present and future state of the economy and to assess the persistence of inflation deviations and expectations with respect to the inflation target. Beginning in 2010, the BDBR established the long-term 3.0% annual inflation target, which remains in effect today. Lower inflation has contributed to making the macroeconomic environment more stable, and this has favored sustained economic growth, financial stability, capital market development, and the functioning of payment systems. As a result, reductions in the inflationary risk premia and lower TES and credit interest rates were achieved. At the same time, the duration of public domestic debt increased significantly going from 2.27 years in December 2002 to 5.86 years in December 2022, and financial deepening, measured as the level of the portfolio as a percentage of GDP, went from around 20% in the mid-1990s to values above 45% in recent years in a healthy context for credit institutions.Having been granted autonomy by the Constitution to fulfill the mandate of preserving the purchasing power of the currency, the tangible achievements made by Banco de la República in managing inflation together with the significant benefits derived from the process of bringing inflation to its long-term target, make the BDBR’s current challenge to return inflation to the 3.0% target even more demanding and pressing. As is well known, starting in 2021, and especially in 2022, inflation in Colombia once again became a serious economic problem with high welfare costs. The inflationary phenomenon has not been exclusive to Colombia and many other developed and emerging countries have seen their inflation rates move away from the targets proposed by their central banks.5 The reasons for this phenomenon have been analyzed in recent Reports to Congress, and this new edition delves deeper into the subject with updated information. The solid institutional and technical base that supports the inflation targeting approach under which the monetary policy strategy operates gives the BDBR the necessary elements to face this difficult challenge with confidence. In this regard, the BDBR reiterated its commitment to the 3.0% inflation target in its November 25 communiqué and expects it to be reached by the end of 2024.6 Monetary policy will continue to focus on meeting this objective while ensuring the sustainability of economic activity, as mandated by the Constitution. Analyst surveys done in March showed a significant increase (from 32.3% in January to 48.5% in March) in the percentage of responses placing inflation expectations two years or more ahead in a range between 3.0% and 4.0%. This is a clear indication of the recovery of credibility in the medium-term inflation target and is consistent with the BDBR’s announcement made in November 2022. The moderation of the upward trend in inflation seen in January, and especially in February, will help to reinforce this revision of inflation expectations and will help to meet the proposed targets. After reaching 5.6% at the end of 2021, inflation maintained an upward trend throughout 2022 due to inflationary pressures from both external sources, associated with the aftermath of the pandemic and the consequences of the war in Ukraine, and domestic sources, resulting from: strengthening of local demand; price indexation processes stimulated by the increase in inflation expectations; the impact on food production caused by the mid-2021 strike; and the pass-through of depreciation to prices. The 10% increase in the minimum wage in 2021 and the 16% increase in 2022, both of which exceeded the actual inflation and the increase in productivity, accentuated the indexation processes by establishing a high nominal adjustment benchmark. Thus, total inflation went to 13.1% by the end of 2022. The annual change in food prices, which went from 17.2% to 27.8% between those two years, was the most influential factor in the surge in the Consumer Price Index (CPI). Another segment that contributed significantly to price increases was regulated products, which saw the annual change go from 7.1% in December 2021 to 11.8% by the end of 2022. The measure of core inflation excluding food and regulated items, in turn, went from 2.5% to 9.5% between the end of 2021 and the end of 2022. The substantial increase in core inflation shows that inflationary pressure has spread to most of the items in the household basket, which is characteristic of inflationary processes with generalized price indexation as is the case in Colombia. Monetary policy began to react early to this inflationary pressure. Thus, starting with its September 2021 session, the BDBR began a progressive change in the monetary policy stance moving away from the historical low of a 1.75% policy rate that had intended to stimulate the recovery of the economy. This adjustment process continued without interruption throughout 2022 and into the beginning of 2023 when the monetary policy rate reached 12.75% last January, thus accumulating an increase of 11 percentage points (pp). The public and the markets have been surprised that inflation continued to rise despite significant interest rate increases. However, as the BDBR has explained in its various communiqués, monetary policy works with a lag. Just as in 2022 economic activity recovered to a level above the pre-pandemic level, driven, along with other factors, by the monetary stimulus granted during the pandemic period and subsequent months, so too the effects of the current restrictive monetary policy will gradually take effect. This will allow us to expect the inflation rate to converge to 3.0% by the end of 2024 as is the BDBR’s purpose.Inflation results for January and February of this year showed declining marginal increases (13 bp and 3 bp respectively) compared to the change seen in December (59 bp). This suggests that a turning point in the inflation trend is approaching. In other Latin American countries such as Chile, Brazil, Perú, and Mexico, inflation has peaked and has begun to decline slowly, albeit with some ups and downs. It is to be expected that a similar process will take place in Colombia in the coming months. The expected decline in inflation in 2023 will be due, along with other factors, to lower cost pressure from abroad as a result of the gradual normalization of supply chains, the overcoming of supply shocks caused by the weather, and road blockades in previous years. This will be reflected in lower adjustments in food prices, as has already been seen in the first two months of the year and, of course, the lagged effect of monetary policy. The process of inflation convergence to the target will be gradual and will extend beyond 2023. This process will be facilitated if devaluation pressure is reversed. To this end, it is essential to continue consolidating fiscal sustainability and avoid messages on different public policy fronts that generate uncertainty and distrust. 1 This Report to Congress includes Box 1, which summarizes the trajectory of Banco de la República over the past 100 years. In addition, under the Bank’s auspices, several books that delve into various aspects of the history of this institution have been published in recent years. See, for example: Historia del Banco de la República 1923-2015; Tres banqueros centrales; Junta Directiva del Banco de la República: grandes episodios en 30 años de historia; Banco de la República: 90 años de la banca central en Colombia. 2 This is why lower inflation has been reflected in a reduction of income inequality as measured by the Gini coefficient that went from 58.7 in 1998 to 51.3 in the year prior to the pandemic. 3 See Gómez Javier, Uribe José Darío, Vargas Hernando (2002). “The Implementation of Inflation Targeting in Colombia”. Borradores de Economía, No. 202, March, available at: https://repositorio.banrep.gov.co/handle/20.500.12134/5220 4 See López-Enciso Enrique A.; Vargas-Herrera Hernando and Rodríguez-Niño Norberto (2016). “The inflation targeting strategy in Colombia. An historical view.” Borradores de Economía, No. 952. https://repositorio.banrep.gov.co/handle/20.500.12134/6263 5 According to the IMF, the percentage change in consumer prices between 2021 and 2022 went from 3.1% to 7.3% for advanced economies, and from 5.9% to 9.9% for emerging market and developing economies. 6 https://www.banrep.gov.co/es/noticias/junta-directiva-banco-republica-reitera-meta-inflacion-3

Why do the new economy and welfare societies recommend a new station on the long journey towards competitiveness initiated within the framework of “The Competitive Advantage of Nations”, published as long as 25 years ago? A little more than twenty-five years ago, the Basque Country decided to equip itself with its own development strategy, undertaking to meet the challenge of designing its own future. The Basque Country aspired to give itself the maximum degree of self-government as a nation without a State, following its release from a long dictatorship which had plunged it into autarchy and isolation from the Western democracies around it, limiting its ability and responsibility to shape its own destiny and to offer its Society the highest standards of welfare, facing one of the greatest economic, political and social crises of its history and suffering from the ravages of terrorism within an economy castigated by soaring unemployment above 25%, a drop in its GDP, the fall, like dominoes, of its key industrial sectors, locked into the monoculture of the steel and metal working industry, outside the Europe which was being constructed by the then Economic Community of the Six, marginalized as a peripheral area from the future axis and development of the so-called “blue banana” of the London-Milan backbone and with an incipient and inexperienced administration, full of youth and enthusiasm, and a business world undergoing conversion, learning to live with a trade union phenomenon that the former dictatorship had bypassed. Faced with this complex and exciting challenge, those of us who had the privilege of addressing the aforementioned proposal, interpreting (by means of our analyses, as well as the wish to make our desires and dreams come true) the main keys to explain the state of the world economy, the main trends of change and their foreseeable impact on the Basque economy (“What the world economy taught us”), began the task of defining what we call “A strategy for the modernization and internationalization of our economy and our Country” trying to give some meaning to the role expected of the new players (States, city-regions, provinces, etc.), a role in which our small Country, with features of a City-Region, a sub-national entity, an invertebrate area on the two sides of the Pyrenees, could assume the figure of co-protagonist and provide society with a prosperous future. We also needed the framework and tools desirable for tackling the success strategy. We identified the gap between the needs that would be generated by the new paradigms and the tools offered by the existing political-economic framework (contents, skills, potential developments), accompanied by our own Country-strategy, with special emphasis on the initiatives, factors and critical vectors our society would demand and its aspirations for well-being and development. Within this context, the Basque Government approached Michael E. Porter, his ideas and concepts of the moment, and we began a collaborative process (which lasts until this day), constructing much more than our “Competitive Advantage of the Basque Country” in a thrilling and unfinished “Journey towards Competitiveness and Prosperity”. The Basque Country enjoys the privilege of having been the first nation to apply, in a strategic and comprehensive manner, the concepts which, a few years later, came to light in the prestigious publication we celebrate today, titled “The Competitive Advantage of Nations”, which has inspired the design of numerous policies and strategies throughout the world, which has brought about a proliferation of followers, which has trained instructors and which has generated a large number of new researchers and academics, new policy makers, new instruments for competitiveness and extraordinary levels of prosperity throughout the world. Since then, we have shared our own particular project which, alive and changing, responds to the new economic and social challenges and conflicts by constructing and applying a Country strategy with distinctive achievements and results beyond our economic environment. It lies within the conceptual framework inspired by the complementary tripod of Michael E. Porter's conceptual movement in his Competitive Advantage (Competitiveness, Shared Value Initiative and Social Progress) and our contributions learned from day to day in keeping with our vocation, identity, will and commitment. It is a never-ending process based on a model and a way of understanding the former pledge to give ourselves a single strategy designed by and for people.