German family policy at the cross-roads.

Comparative studies of welfare reforms encounter two problems: first, the counterfactual problem is that in the real world, benefit schemes and their reforms do not coexist simultaneously and are hard to compare. Second, the contextual problem derives from the absence of comparable measures for change. Microsimulation is well suited for overcoming these two problems. It compares policy options – whether actual reforms or reform plans – simultaneously, thereby providing a comparable measure: the disposable income of model cases. This article investigates German and Swedish parental leave benefits using microsimulation to measure the impact of three recent German reforms. By making benefit reforms comparable, the simulation approach allows identifying policy convergence or divergence. Results show that the profile of the German benefit is changing, from ‘general family’ towards ‘dual-earner’ support. The recent reforms introduce a new concept of fairness and a focus on gender equality to German family policies.