Jobs with equality
Economic and social shifts have led to rising income inequality in the world's affluent countries. This is worrisome for reasons of fairness and because inequality has adverse effects on other socioeconomic goods. Redistribution can help, but government revenues are threatened by globalization and population aging. A way out of this impasse is for countries to increase their employment rate. Increasing employment enlarges the tax base, allowing tax revenues to rise without an increase in tax rates; it also reduces welfare state costs by decreasing the amount of government benefits going to individuals and households. The question is: Can egalitarian institutions and policies be coupled with employment growth? For two decades conventional wisdom has held that the answer is no.
In Jobs with Equality, Lane Kenworthy provides a comprehensive and systematic assessment of the experiences of rich nations since the late 1970s. This book examines the impact on employment of six key policies and institutions: wage levels at the low end of the labor market, employment protection regulations, government benefit generosity, taxes, skills, and women-friendly policies. The analysis includes twenty countries, with a focus on Australia, Canada, Denmark, Finland, France, Germany, Italy, the Netherlands, Norway, Sweden, the United Kingdom, and the United States. Kenworthy concludes that there is some indication of tradeoffs, but that they tend to be small in magnitude. There is no parsimonious set of policies and institutions that have been the key to good or bad employment performance. Instead, there are multiple paths to employment success. The comparative experience suggests reason for optimism about possibilities for a high-employment, high-equality society.
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Why Should We Care About Inequality?
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affluent countries Anglo countries appendix Author's calculations average Change in employment Chapter chart in Figure childcare coefficient comparatively consumption taxes continental countries cross-country data definitions data in OECD decommodification definitions and sources Denmark distribution earner effect EITC employed employees employment change employment growth employment levels employment performance employment protection regulations employment-conditional earnings subsidy Esping-Andersen Finland France Germany Gini coefficient government benefit generosity high employment higher homogamy household income inequality impact increase inequality reduction ISIC Italy Kenworthy labor market literacy low inequality low-end services low-end wages market income measure median ment minimum wage Netherlands Nordic countries Norway part-time employment payroll and consumption payroll taxes posttax-posttransfer income pretax-pretransfer income programs public employment redistribution regression lines relatively Sam's Club sector suggest Sweden tax rates tax revenues taxation twelve countries United Kingdom variable wage levels women age women-friendly policies women's employment rates workers working-age households working-age population