Abstract
The manner in which open economies in a globalized world shape social policy development is highly disputed, as is the impact of the current financial crisis on social policy. One argument is that globalization and economic austerity force social policy dismantling. Alternatively, it is proposed that open economies – facing greater volatility, especially during crisis – push for greater social protection. Using the examples of Botswana and Mauritius, two open middle-income countries, this article suggests that, in fact, both arguments may be correct. The impact of globalization and economic crisis depends on the character of the welfare system already in place and the organized interests underpinning it. In Botswana a main social policy thrust is to increase efficiency in spending, whereas issues of job security and compensation are more prevalent in Mauritius. The findings imply that divergence across welfare systems persists and that, even in crisis, countries often use tried social policy solutions.