The rise of the super-rich has attracted much political and academic attention in recent years. However, there have been few attempts to explain the cross-national along with the temporal variation in the rise of top incomes. Drawing on the World Wealth and Income Database, we study the income share of the top 1% in current postindustrial democracies from 1960 to 2012. We find that extreme income concentration at the top is a predominantly political phenomenon, not the result of increasing marginal productivity of top managers in markets of increasing size. Top income shares are largely unrelated to economic growth, increased knowledge-intensive production, export competitiveness, financialization and wealth accumulation, though they are related to stock market capitalization. Instead, they are closely associated with political and policy changes such as union density and centralization, secular-right governments, top marginal tax rates and investment in public tertiary education.
This book examines the transformation of contemporary social democracy through the concept of 'third way' reforms. It proposes a set of theories about the possibility for continuing social democratic ideological adaptation, for ideologies to overcome institutional constraints in triggering path-breaking innovations, and for social democracy to bridge the insider-outsider divide. Empirically, the book utilizes these theories to account for social democratic welfare state and labor market reforms in nine OECD countries after the end of the Golden Age. Based on the logic of 'public evils', the book proposes that the ideologically contested nature of institutions provides incentives for institutional innovation. Social democratic ideology shapes the fundamental characteristics and content of the third way policy paradigm, and the paradigm's practical implementation continues to be path-dependent on historical institutional settings.
In Esping-Andersen's influential work on three worlds of welfare capitalism, decommodification appears as the central characteristic of the welfare state, and efforts to de-commodify labor are posited to be the main goal of social democracy. Since decommodification is defined as exit from the labor market with little or no loss of income, social democrats' emphasis on decommodification clashes with another purported goal of social democracy, high labor force participation. Drawing on research demonstrating the divergent employment effects of various decommodifying social policies, we resolve the existing paradox by showing that social democratic parties are supportive of decommodifying social policies insofar as these policies do not reduce aggregate levels of employment. Pooled time series analysis of employment-impeding policies (long-term unemployment replacement rate, social security and payroll taxes, and employment protection) suggests that they are associated with Christian democracy rather than social democracy. Instead, we find that social democracy is a key determinant of employment-friendly policies, such as active labor market spending and short-term unemployment replacement rate. Given the radically divergent employment effects of different types of decommodifying social policies and the importance of employmentfriendly policies for the viability of generous welfare states, our analysis serves to further underline the future viability of the social democratic model
The Kellogg Institute for International Studies at the University of Notre Dame has built an international reputation by bringing the best of interdisciplinary scholarly inquiry to bear on democratization, human development, and other research themes relevant to contemporary societies around the world.Together, more than 100 faculty and visiting fellows as well as both graduate and undergraduate students make up the Kellogg community of scholars. Founded in 1982, the Institute promotes research, provides students with exceptional educational opportunities, and builds linkages across campus and around the world. The Kellogg Working Paper Series:! Shares work-in-progress in a timely way before final publication in scholarly books and journals ABSTRACTThe rise of the super-rich has attracted much political and academic attention in recent years. However, to date there have been few attempts to explain the cross-national variation in the recent rise of very top incomes. Drawing on the World Top Incomes Database, we study the income share of the top 1% in almost all current postindustrial democracies from 1975 to 2012. We find that extreme income concentration at the very top is a predominantly political phenomenon, not the outcome of economic changes. Top income shares are largely unrelated to economic growth, increased knowledge-intensive production, export competitiveness, market size, financialization, and wealth accumulation. Instead, they are driven by various political and policy changes that reflect a decline in the relative power and resources of labor, such as union density and centralization, secular-right governments, and cuts in top marginal income tax rates as well as in public spending on education. RESUMENEn los últimos años, el ascenso de los super-ricos atrajo mucha atención política y académica. Sin embargo, hasta el momento se hicieron pocos intentos de explicar la variación internacional en el crecimiento reciente de los ingresos más altos. Tomando información de la Base Mundial de Datos sobre los Ingresos más Altos (World Top Incomes Database) estudiamos la porción del ingreso del 1% superior en casi todas las democracias postindustriales actuales desde 1975 hasta 2012. Encontramos que la extrema concentración del ingreso en la cúspide es un fenómeno predominantemente político y no resulta de cambios económicos. La participación de los ingresos superiores no está relacionada en ninguna medida significativa con el crecimiento económico, un aumento en la producción que hace un uso intensivo del conocimiento, la competitividad de las exportaciones, el tamaño de los mercados, el desarrollo del sector financiero o la acumulación de riqueza. En cambio, está guiada por varios cambios en la política y en las políticas que reflejan una declinación en el poder relativo y en los recursos de los trabajadores, tales como la densidad sindical y la centralización, los gobiernos seculares de derechas y las reducciones tanto en las tasas marginales superiores de impuestos sobre los ingresos como en el gasto púb...
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