The privatization and marketization of social policy is a central element of recent welfare state transformation. By delivering public goods and services in areas such as health care, nursery, pensions, and labor market services, private for-profit providers have started to take over crucial functions of (and within) the welfare state. The rise of firms is especially interesting for students of the organizational dimension of the welfare state. While there is already some research on the political regulation of welfare markets, we know surprisingly little about the private firms that emerge as new actors in the welfare state. The proposed paper addresses this research gap by mapping the characteristics of private for-profit providers of social policy. Combining a political economic approach with an organizational perspective this paper lays the groundwork for further research on the new public-private arrangements of welfare governance, i.e. actor constellations and modes of interaction. The descriptive-analytical paper is designed as a cross-national, cross-sectoral study. It compares private for-profit providers of pensions and hospitals in Germany and the UK. To this end three dimensions are crucial: 1) How did welfare markets develop? (process of market constitution, early market development, market volume, level and kind of competition); 2) What does characterize welfare industries in terms of organizational features? (legal form, insider vs. outsider control, capital market orientation); 3) How – and to what extent – are firms integrated into business networks? (associations, personal and organizational networks, political representation). The study is based on the analysis of both aggregated quantitative data and qualitative data. The case selection guarantees for variation over several dimensions, e.g. stage of market development, kind of provision, political and institutional setting. Choosing contrasting cases the paper aims at exploring the variety of firms as welfare state actors. It therewith provides information about an increasingly important organization of Western welfare governance.
