Labour Markets, Institutions and Inequality

Abstract

ForewordThe premise of this fine collection of essays has become unfashionable in recent decades. The rise of the neoliberal order, the Washington Consensus, 'there is no alternative' and la pensée unique, entailed a decline of professional interest, among economists, in social institutions and the structures of economic life.As part of this, trade unions, wage norms, workplace standards and social insurance programs have come to be seen by many economists and political leaders as obstacles to rather than instruments of progress. We are told -even by the King of the Netherlands -that the 'welfare state has ended'. It is to be replaced by something called the 'participation society'. The irony of hearing this from the lips of a monarch, whose family activities cost the Dutch taxpayer some 100 000 000 euros per year, was perhaps not entirely lost on his subjects. 1 Janine Berg and her colleagues at the International Labour Office present a different view. They argue that participation occurs through, and is mediated by, organizations, institutions and governments. Workers organize into unions to contest for rights in the workplace, for decent wages and social protections. Institutions consolidate gains, creating structures of precedent on which more gains can be based. In principle -if not always in practice -governments represent the expression of democratic will. Democratic politics and its consequence -the welfare state -are therefore the essence of participation and not some contradiction to it.Moreover, though battered, besieged and often declared dead, the welfare state survives. It survives because it has to. It survives because in the modern world the alternative is chaos. There is a libertarian fantasy that economies can be re-based on individual saving, self-reliance, deunionization, privatized health, education and retirement, and deregulation and de-supervision of markets. It is a fantasy with powerful backing, to be sure, but lobbies cannot turn fantasies into functional economics.In the modern world, private markets depend on the assurance of quality that only effective regulation and supervision can provide. Without that, they have a strong tendency to collapse; people will not

Negotiating wage (in)equality: changing union strategies in high-wage and low-wage sectors in Czechia and Slovakia

“…Labour market institutions influence wage inequality through the dominant bargaining level, extensions of collective agreements, derogation and national minimum wage setting (Autor et al, 2016; Berg, 2015; Calmfors et al, 2001; Glassner et al, 2011; Keune, 2010; Traxler and Kittel, 2000). Bargaining coordination mitigates wage inequalities, while decentralised bargaining is the least efficient for decreasing inequalities (Bosch, 2015; Hayter and Visser, 2018; Moene and Wallerstein, 1997; Wallerstein, 1999).…”