The modern welfare state emerged first in Germany when Bismarck introduced income security measures for industrial workers in 1883. It then spread to the rest of the Continent and England. Welfare states in Europe achieved steady growth, adding new programs periodically and extending coverage to additional segments of their populations. In North America, however, comparable social insurance legislation was not enacted until 1927 in Canada and 1935 in the United States. These countries achieved partial development of major income maintenance programs such as national health insurance, sickness and maternity insurance schemes for workers, family allowances, and housing. In the 1970s Canada took steps toward a public provision of all these measures, leaving the United States the only advanced nation that has not adopted a package of comprehensive national insurance plans.

Efforts to explain these broad variations in the adoption and development of modern welfare programs have taken many forms. Most explanations consider a combination of domestic socioeconomic and political factors among Western countries. They maintain the view that national welfare programs were the result of domestic changes in economic relations and political forces. More recently there has been growing recognition of the importance of the world context shaping the course of welfare state development. This position suggests that national welfare programs were not only a product of unique domestic conditions of each country, but also the outcome of a process of state transformation in a larger world context.