During the 1990s, a prominent strategy of economic adjustment to the challenges of competitiveness and budgetary retrenchment among the non-corporatist countries of Europe was the negotiation of social pacts. Since the onset of the great recession and the Eurozone crisis, social pacts have been conspicuous by their absence. Why have unions not been invited into government buildings to negotiate paths of economic adjustment in the countries hardest hit by the crisis? Drawing on empirical experiences from Ireland and Italy-two cases on which much of the social pact literature concentrated-this article attributes the exclusion of unions to their declining legitimacy. Unions in the new European periphery have lost the capacity either to threaten governments with the stick of protest or to seduce policymakers with the carrot of problem-solving. They are now seen as a narrow interest group like any other.

The Varieties of Capitalism literature offers two competing hypotheses on institutional resilience. One argues that globalization promotes convergence towards a neo-liberal system. Another stipulates that diverse capitalist regimes promote different comparative advantages, enabling diverse political economies to co-exist. In this article, we argue that the compatibility of diverse models of capitalism is contingent upon monetary regime. We examine how different currency regimes influence the mutual co-existence of export-led growth models (euro core) and domestic demand-led growth models (euro periphery). Under EMU, we find that these two models have become increasing incompatible, as unsustainable divergences in external balances have emerged between them. We hypothesize that external imbalances between these two growth regimes did not emerge prior to EMU because of the presence of two inflation adjustment mechanisms in the real exchange rate; the nominal exchange rate (in soft currency regimes) and national central banks' promotion of inflation convergence (in hard currency regimes).

Comparative political economy (CPE) has robustly examined the political and institutional determinants of income inequality. However, the study of wealth, which is more unequally distributed than income, has been largely understudied within CPE. Using new data from the World Income Database (WID), this article examines how economic, political and institutional dynamics shape wealth-to-income ratios within Western European and OECD countries. It is found that the political and institutional determinants that affect income inequality have no short-or long-run effects on the wealth-to-income ratio. Rather, the rise in wealth-to-income ratios is driven by rising housing prices, as well as price changes in other financial assets, not home ownership or national saving rates. The article concludes by examining how the changing dynamics of housing prices and wealth inequality will increasingly shape intergenerationaland associated class-basedpolitical conflict in Western Europe. KEYWORDS Wealth inequality; wealth accumulation; income inequality; housing prices; comparative political economy Comparative political economy (CPE) has long been preoccupied with the political and institutional determinants of economic inequality, particularly within Western Europe. Robust debates in CPE have examined how left-wing governments, strong unions and collaborative wage-setting institutions, progressive taxation, a redistributive welfare state and public sector employment impact on income inequality (

The European response to the sovereign debt crisis has exposed a tension between the national and the supranational in a multilevel polity while opening up new political cleavages between the north and south of the Economic and Monetary Union (EMU). This dilemma has become particularly acute for programme countries that were either directly or indirectly in receipt of non-market financial fundingfrom the troika. Drawing upon a new international political economy approach to comparative political economy, this article argues that joining together two distinct macroeconomic growth regimes is the real source of the euro crisis: domestic demand-led models, which predominate in southern Europe, and export-led models, which dominate the landscape of northern Europe. European policymakers assume that all member states can converge on an export-led model of growth. This vision of convergence is exacerbating rather than resolving the imbalance of capitalisms at the heart of the Eurozone.