Gustav Schmoller, His Heirs and the Foundation of Today’s Social Policy

Three elements make up the heart of Gustav Schmoller’s conception of social policy: 1. Schmoller’s comprehensive view regarding social policy issues; 2. Schmoller’s distinction between the internal and external effects of socio-political measures and finally, 3. the importance Schmoller places on education. For Schmoller, social policy represents far more than the setting up of individual welfare measures; instead, social policy is always linked to the encompassing and dynamic societal conditions. In this way, social policy – as understood by Schmoller – mainly aims at ensuring that individuals take part in social progress. In the wake of Schmoller, two different development lines can be distinguished today: on the one hand, the attempt to better reach Schmoller’s social policy objective by using a modern economic theory, which, however, leads to the dissociation of (economic) means and (social) objectives. On the other hand, the conviction that social policy must be understood as a central element of societal policy. The latter position does justice to Schmoller’s integrative perspective, yet the implementation in terms of economic policy remains problematic. Integrating these two lines might be feasible by using an ordoliberal approach that balances economic policy and social policy on the constitutional level. The inclusion of every individual into society is also a top priority of ordoliberal social policy. The return to Schmoller’s social political concern using the ordoliberal research method could offer vital impulses in the ongoing debate about the welfare state.