Seminar paper from the year 2002 in the subject Politics - Political Systems - Germany, grade: 1,0, Leiden University, course: Comparative Government and Civil Service Reforms, 14 entries in the bibliography, language: English, abstract: Institutional choice and design are currently important topics on the political agenda of European welfare states. Olsen (1997:207f) observes that many governments are turning away from the centralized welfare state-project and try to reorganize political institutions, in particular relationships between the state, society and citizens. He identifies four major reform projects: the democratic decentralization project, the civil society project, the market society project and the European integration project. Currently, the market society project seems to be most influential, aiming at the creation of a new political and social order with the competitive market as core value. Also in Germany the welfare state has come under pressure. High unemployment figures have recently received the greatest attention and most public concern. In this context, the revelation of major dysfunctions in the Bundesanstalt für Arbeit (Federal Labour Office) led to a scandal and forced the government to launch a comprehensive reform programme. This raises the question if institutions can be deliberately changed in modern democratic states. The analysis of this paper refers to the above-mentioned reform programme of the German Bundesanstalt für Arbeit (BA) and addresses the following questions: Firstly, the concept of institutional design will be applied to the reform programme. Secondly, it is assumed that potential design is dependent on basic institutional features of democratic policies. The question is then: In what way do democratic contexts affect the possibilities for institutional design - making it necessary, politically feasible and legitimate? Thirdly, taking into account these possibilities and constraints for institutional design, two alternative strategies for potential reformers are identified, which enable them to exploit opportunities for design. The paper is structured as follows: Firstly, the case of the Bundesanstalt für Arbeit and the reform programme will be shortly described. After that, efforts for institutional design will be identified in the reform programme. The following sections will then discuss the necessity, feasibility and legitimacy of design in democratic contexts before introducing the reform strategies. The final section is a critical evaluation of some aspects of the concept.