The political economy of inequality in Ireland. Labour markets as social institutions

Transcription

1 The political economy of inequality in Ireland Labour markets as social institutions

2 The revival of political economy From the outset, political economy sought to study scientifically, or at any rate rationally, systematically, and methodically, the ideal role of the state in the economic and social organisation of a country. (Piketty 2014) Distributional conflict over the social product (Martins 2013)

3 Regulation Theory (RT) Economic history Periodisation of capitalism (McDonough 2007) Middle range (Merton 1949) Interconnection between institutional forms and dynamic regularities of capitalist economies (Jessop 2006) Relative stability Structural crisis Institutional restructuring

4 Labour markets and social agency Individual workers and employers are embedded in classes (Zweig 2015) Social formations reflecting power Capital-labour relation Labour process theory (Braverman 1974) Relative autonomy of the capitalist state (Poulantzas 1978) Social relation Balance of class forces (Wolfson and Kotz 2010) Condensation of the class struggle

5 Regulating economic inequality Two broad forms of capitalism (Kotz 2015) Liberal Capital largely dominates over labour Free market orientation (ideas, policies, institutions) Rising inequality Financial instability Regulated Labour forces a class compromise Non-market intervention (states, unions) Subdued inequality Profit squeeze Tendency to alternate Punctuated by structural crises

6 Net income inequality in the EU Net Gini Source: Eurostat

7 Income share of top 1% and bottom 90% 74% 14% 72% Bottom 90% (left y) 12% 70% 10% 68% 8% 66% Top 1% (right y) 6% 64% 4% 62% 2% 60% % Source: WWID

8 Wage share, % of GDP 70% 65% 60% 55% 50% Ireland US EU 15 UK 45% 40% Source: AMECO

9 Incidence of low pay in OECD countries 30% 25% 20% 15% 10% 5% 0% Source: OECD Stat

10 Rising incidence of low pay 27% 25% 23% 21% Ireland UK US 19% 17% 15% Source: OECD Stat

11 Trade union density 60% 55% 50% 45% 40% 35% 30% 25% Source: OECD Stat

12 Net wealth by decile 60% 50% 14.8% 40% Top 1% Share of Net Wealth 30% 20% 10% 0% -3.5% 0.0% 0.2% 1.2% 3.5% 5.7% 8.3% 11.9% 18.9% 22.9% 16.1% 95-99% 90-94% 0-90% % Bottom Net Wealth Decile Top Source: CSO HFCS, 2015

13 Wealth share of top 10% and top 1% 90% % 70% 60% 53% 50% 40% 42% 30% 20% 10% 10% 14.70% 0% Top 10% Top 1% Source: Nolan, 1991; CSO HFCS, 2015

14 Income share of top 10% 60% 55% 50% 45% 40% 35% US Ireland Denmark 30% 25% 20% 15% Source: WWID

15 Responding to the crisis Neoliberal solutions won t resolve a neoliberal crisis (Kotz and McDonough 2010) Demands an alternative Privitisation is a vogue word today. Too many economists are enthusing about the race towards an unfettered, unrestrained free market economy. This is worship of an unthinking consumerism, animated not by considerations of social responsibility but a desire for the fast buck and let tomorrow look after itself (Lynch 1994)

16 A wage-led recovery Generalised wage repression Debt-led growth (EU periphery, US, UK) Export-led growth (Germany, China, Japan) Wage-led recovery (Onaran and Stockhammer 2016) Predistributive labour market policies Redistributive progressive taxation Broader reorientation towards progressive macroeconomic and industrial policy Full employment Equality Ecological sustainability

17 Political aspects of full employment Full employment capitalism will, of course, have to develop new social and political institutions which will reflect the increased power of the working class. If capitalism can adjust itself to full employment, a fundamental reform will have been incorporated in it. If not, it will show itself an outmoded system which must be scrapped. (Kalecki 1943)

18 Collective bargaining coverage and low pay incidence in OECD countries 30% Low pay incidence 25% 20% 15% USA EST KOR POL ISR SVK HUN MEX JPN NZL CHL CAN GBR IRL GRC CZE LUX DEU AUS PRT ESP NLD ISL AUT 10% CHE ITA DNK FIN 5% BEL 0% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Collective bargaining coverage rate Source: OECD Stat and ILOSTAT

19 Collective bargaining coverage and net income inequality in OECD countries MEX CHL 0.45 Net Gini Coefficient TUR KOR USA JPN NZL POL ISR GBR EST CAN IRL HUN SVK GRC CHE CZE DEU LUX AUS SVN PRT NOR ESP ITA NLD DNK SWE ISL FIN FRA AUT BEL 0.2 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Collective bargaining coverage rate Source: OECD Stat and ILOSTAT

20 Thank you