Competitive federalism and workers' compensation: do states race to the bottom?

Abstract

This article builds on the competitive federalism literature by examining the role federalism plays in determining policy trajectories with consequences for public welfare in individual jurisdictions. It examines the argument that federalism encourages a ‘race to the bottom’ using the case of workers’ compensation benefits for injured workers in Australia. It finds state systems have been characterised by a downward slide in the protections afforded injured workers since the late 1970s, and this has been associated with policy makers’ real or rhetorical concerns around interstate competition for business investment.