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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Lane Kenworthy is professor of sociology and political science at the University of Arizona. He studies the causes and consequences of poverty, inequality, mobility, employment, economic growth, and social policy in the United States and other affluent countries. He is author of In Search of National Economic Success (1995), Egalitarian Capitalism (2004), and articles in various social science journals.
"On the premise that high employment is essential to the realization of egalitarian goals in the contemporary era, this important book explores how social policies and institutional arrangements in advanced capitalist societies have affected employment growth over the last three decades. Kenworthy synthesizes existing literature and presents new empirical findings based on original cross-national data and measurements. His most important contribution is to explore multiple determinants of employment performance and interactions among these determinants in a systematic fashion. Very sensibly, the analysis yields policy recommendations that are specific to particular institutional contexts. For students of comparative political economy, the particular questions that Kenworthy addresses are now settled for some time to come."--Jonas Pontusson, Professor of Politics, Princeton University
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