The Political Economy of Inequalities
Vienna University of Economics and Business, 2021
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The Political Economy of Inequalities
This course fokus on the ontemporary debates on the role of inequality for social and political cohesion.
This concentration area will cover a key arena of contemporary debates on the role of inequality for social and political cohesion, economic and social sustainability. The concentration area runs over two semesters, with a two-hour unit running in summer semesters followed by four-hour units running in winter semesters. Although the two units are assessed separately, they should be interpreted as an integrated unit where lessons from the two-hour unit carry over to the four-hour unit course. In this first semester, the concentration area will start with introducing students to standard work on earnings, wage and wealth inequality, the causes of and consequences for individuals and society. It will then critically question and move beyond a narrow focus on individual or household income to various forms of group inequality (gender, ethnic, territories, neighborhoods) and none-monetary forms of inequality, rounded off by discussions on power relations, the role of the media, and the decisive role of institutions. In keeping with the requirements of a socio-economic approach, this requires a trans-disciplinary focus drawing not only on economics but also on sociology, political science, philosophy, feminist theory and geography.
At the end of this course, students should acquire the following learning outcomes:
- Acquire a profound understanding of the political economy of inequality
- Analysis of economic inequality, and economic policies regarding inequality
- Critical reflection of core concepts and themes within the inequality topic
- Contextualisation of economic approaches and policies towards inequality
In addition, students should strengthen their discussion skills, their ability to draft a project outline, as well as their ability to self-dependent learning within this course.
Assignments and Assessment
There are three portions to students’ grades: class participation:
- Class participation 30%
- Short written assignments 30%
- Group take home exam 40%
Attendance requirements: Students may miss one session without penalty.
Schedule of topics covered and mandatory readings
Session 1 Inequalities: Introduction
Topics: Legitimating inequality; Naturalizing inequality
- Cook, E. (2020) Naturalizing Inequality: The Problem of Economic Fatalism in the Age of Piketty. Capitalism: A Journal of History and Ecoomics 1: 338-378.
- Wisman, J.D. and Smith, J.F. (2011) Legitimating inequality: Fooling most of the people all of the time. American Journal of Economics and Sociology 70: 974-1013.
Session 2 Consequences of Inequality
Topics: Why should we be concerned about inequality; Discussion on the link between inequality and post-democracy/populism.
- Freeman, D. (2017). De-Democratisation and Rising Inequality: The Underlying Cause of a Worrying Trend. LSE International Inequalities Institute. Working Paper 12. May 2017.
- Rodrik, D. (2018) Populism and the economics of globalization. Journal of International Business Policy. https://doi.org/10.1057/s42214-018-0001-4
- As overview I recommend the book chapter by Chaucel (2020) (on learn). We won’t discuss that because it is quite straight forward but for those of you who have not had much exposure to the topic, I would suggest having a look at it. Also of interest on that topic is the website of the inequality trust: https://www.equalitytrust.org.uk/ There are plenty of papers, working papers, blogs, etc. on the website.
- Essletzbichler, J., Disslbacher, F. and Moser, M. (2018) The victims of neoliberal globalisation and the rise of the populist vote: a comparative analysis of three recent electoral decisions. Cambridge Journal of Regions, Economy and Society. 11: 73-94
- Atkinson, A. (2015). Inequality. What can be done? Harvard University Press.
- Milanovic, B. (2016). Global Inequality. A New Approach for the Age of Globalization. Harvard University Press.
- Piketty, T. (2019). Capital and Ideology. Harvard University Press.
- Stiglitz, J. (2012) The Price of Inequality. Norton.
- Wilkinson, R. and K. Pickett (2009) The Spirit Level
Session 3 Causes of inequality
Topics: Standard economic arguments on rising inequality: Skill-biased technological change (race between education and technology), etc. (see Noah); Neoliberalism.
- Goldin, C. and Katz, L. (2007) The Race between Education and Technology: The Evolution of U.S. Educational Wage Differentials, 1890 to 2005. NBER Working Paper 12984 http://www.nber.org/papers/w12984.
- Dumenil, G. and D. Levy (2015) Neoliberal Managerial Capitalism, International Journal of Political Economy, 44:2, 71-89.
- For those who have not read much on inequality I suggest to have a look at the following overview. It is written for a broad audience, and hence, does not really need much discussion: Noah, T. (2010) The Great Divergence. Slate Magazine. https://slate.com/news-and-politics/the-great-divergence
- Dumenil, G. and D. Levy (2004). Neoliberal Income Trends. New Left Review 30: 105-133.
- If you look at the Noah series, there are plenty of links to some of the key papers on the causes of inequality.
Session 4 Moving beyond individuals
Topics: Problems of methodological individualism; social stratification processes; spatial, ethnic, gender, class polarization;
- Massey D. (2008) Categorically Unequal, Chapter 1, How Social Stratification Works. Russell Sage Foundation.
- Trounstine, J. (2018). Segregation by Design. Cambridge University Press. CHAPTER TBA.
- Tilly, C. (1999) Durable Inequality. University of California Press.
Session 5 Spatial scales of inequality
Topics: Waves of technological change, regional economic divergence and social segregation; Inequality and institutional context at various spatial scales; spatially situating inequality; varieties of capitalism, welfare state regimes and local institutions (educational districts; local property taxes; housing markets); social infrastructure provisioning; power relations.
- Kemeny, Thomas and Storper, Michael (2020) Superstar cities and left-behind places: disruptive innovation, labor demand, and interregional inequality. Working Paper (41). International Inequalities Institute, London School of Economics and Political Science, London, UK.
- Storper, M. (2011). Justice, efficiency and economic geography: should places help one another to develop? European Urban and Regional Studies 18: 3-21.
- Bernard BRET, ”Spatial Justice and Geographic Scales“, [« La justice spatiale à l’épreuve des échelles géographiques, translation: Laurent Chauvet], Justice spatiale | Spatial Justice, no 12, October 2018 (http://www.jssj.org).
- Chetty, R., Hendren, N. and Katz, L. (2016) The Effects of Exposure to Better Neighborhoods on Children: New Evidence from the Moving to Opportunity Experiment), American Economic Review 106(4): 855-902, 2016
- Milanovic, B. (2012) Global Income Inequality by the Numbers: In History and Now. Policy Research Working Paper 6259
- Trounstine, J. (2018). Segregation by Design. Cambridge University Press.
- More papers by Chetty et al: http://www.rajchetty.com/papers-chronological/
- Nieuwenhuis, J., Tammaru, T., van Ham, M., Hedman, L. and Manley, D. (2019) Does segregation reduce socio-spatial mobility? Evidence from four Euorpean countries with different inequality and segregation contexts. Urban Studies. DOI: 10.1177/0042098018807628
- Storper, M. (2018). Separate Worlds? Explaining the current wave of regional economic polarization.
Session 6 Beyond monetary income - Neighborhoods and access to universal basic services
Topics: alternative income concepts; universal basic services; the role of neighborhoods;
- Chetty, R., Hendren, N., Kline, P. and Saez. E. (2014) Where is the land of opportunity? The Geography of Intergenerational Opportunity in the United States. Quarterly Journal of Economics 129(4): 1553-1623, 2014
- Engelen, E., Fround, J., Johal, S., Salento, A. and Williams, K. (2017). The grounded city: fro competitivity to the foundational economy. Cambridge Journal of Regions, Economy and Society 10: 407-423.
- Froud, J., Johal, S., Moran M., Salento, A and Williams, K. (2018). Foundational Economy. Manchester University Press: Manchester.
- Gough, I. (2017b). Recomposing consumption: defining necessities for sustainable and equitable well-being. Philosophical Transactions A 375: 20160379.
- Gough, I. (2019) Universal basic services: A theoretical and moral framework. The Political Quarterly 90: 534-542.
- Gough, I. (2020) In Times of Climate Brakedown. How Do We Value What Matters?
- Open Democracy. https://www.opendemocracy.net/en/oureconomy/times-climate-breakdown-how-do-we-value-what-matters/. Accessed February 5, 2021.
Session 7 Inequality - an Institutional Economics’ perspective
Topics: introduction of core issues and concepts in Institutional Economics, such as institutions, power, habits, collective habits of thought and downward/ upward causation. Discussion of Institutional Economics perspective on (economic) inequality
- Hodgson, G.M. (2006). What Are Institutions? In. Journal of Economic Issues, 40(1), p. 1-25.
- Brown, C. (2005). Is there an institutional theory of distribution? In. Journal of Economic Issues 39(4), p. 915-931.
- Dimmelmeier, A. & Heussner, F. (2016). Institutionalist Economics. https://www.exploring-economics.org/en/orientation/institutionalist-economics/
- Trigg, Andrew B. (2001). Veblen, Bourdieu, and Conspicuous Consumption. Journal of Economic Issues, 35:1, 99-115
- Kesting, Stefan (2005) Countervailing, conditioned, and contingent—the power theory of John Kenneth Galbraith, Journal of Post Keynesian Economics, 28:1, 3-23
Session 8 Inequality - a Feminist Economics’ perspective
Topics: introduction of core concepts and perspectives in Feminist Economics, such as social provisioning, gender biases and socially constructed perceptions, value judgements, subjectivity, and reproductive labour. Discussion of Feminist Economics’ perspectives on inequality
- Nelson, J. (1995). Feminism and Economics. In. Journal of Economic Perspectives 9(2), p.131-148.
- Perrons, D. (2015). Gendering the inequality debate. In. Gender & Development 23(2), p.207-222.
- Himmelweit, S. (2018). “Feminist economics.” Fischer, L. et al.: Rethinking Economics: An introduction to pluralist economics. Abingdon and New York: Routledge, 60-75.
- Jacobsen, Joyce P. (2020): Advanced Introduction to Feminist Economics. Elgar Advanced Introductions
- Power, M. (2004). Social Provisioning as a Starting Point for Feminist Economics. Feminist Economics, 10(3), 3-19.
- Urban, Janina and Andrea Pürckhauer (2016). The Perspectives of Pluralist Economics. https://www.exploring-economics.org/en/orientation/feminist-economics/
Session 9 Inequality – The Role of the Media 1: Media’s take on Inequality
Topics: What is the role of news media in shaping the people’s knowledge and preferences of inequality and redistribution policies? How does the media take in the topic of economic inequality, what is reported, what is neglected; what are the narratives told? How does this affect the perception on inequality and redistribution policies?
- Grisold, Andrea & Hendrik Theine (2020) “Now, What Exactly is the Problem?“ Media Coverage of Economic Inequalities and Redistribution Policies: The Piketty Case, Journal of Economic Issues, 54:4, 1071-1094, DOI: 10.1080/00213624.2020.1829905
- Bell, C. V., & Entman, R. M. (2011). The media’s role in America’s exceptional politics of inequality: Framing the Bush tax cuts of 2001 and 2003. The International Journal of Press/Politics, 16(4), 548-572.
- Andrea Grisold and Paschal Preston (ed. 2020): Economic Inequality and News Media. Discourse, Power, and Redistribution; Oxford University Press – selected chapters
- Champlin, D. P., and J. T. Knoedler (2008): American Prosperity and the ‘Race to the Bottom’: Why Won’t the Media Ask the Right Questions? In: Journal of Economic Issues, 42/1: 133-151.
Session 10 Inequality – The Role of the Media 2: (Global) media ownership and the propaganda model
Topics: Who owns the (news) media? What are different types of media ownership and how do they relate to the quality of news coverage? What are basic institutional structures of the (news) media and how do they influence the performance of the news coverage? How has privileged access to and control over the news content?
- Benson, R. (2019). Rethinking the Sociology of Media Ownership. In Laura Grindstaff (Ed.), Routledge Handbook of Cultural Sociology (2nd ed., pp. 387–396).
- Herman, E. S. & Chomsky, N. (2002). Manufacturing Consent: The Political Economy of the Mass Media. Pantheon Books. Chapter 1: A Propaganda Model.
- Theine, H. & Grabner, D. (2020): Trends in Economic Inequality & News Mediascape; in: Andrea Grisold and Paschal Preston (ed.): Economic Inequality and News Media. Discourse, Power, and Redistribution; Oxford University Press, 21-47
- Arsenault, A., & Castells, M. (2008). Switching Power: Rupert Murdoch and the Global Business of Media Politics. International Sociology, 23(4), 488–513.
- Birkinbine, B.J. et al. (Eds.) (2017. Global Media Giants. Routledge.
- Noam, E. M. (Ed.). (2016). Who owns the world's media?: Media concentration and ownership around the world. Oxford University Press. Chapter 1: Introduction.
Session 11 Power and Inequality
Topics: what are different types of power? What is the relationship between power and (economic) inequality? How do unequal power structures cause and sustain (high levels of) inequality?
- Hayward, C., & Lukes, S. (2008). Nobody to shoot? Power, structure, and agency: A dialogue. Journal of Power, 1(1), 5-20.
- Hacker, J. S., & Pierson, P. (2010). Winner-take-all politics: Public policy, political organization, and the precipitous rise of top incomes in the United States. Politics & Society, 38(2), 152-204.
- Rehm, M., Schnetzer, M. (2015): Property and Power: Lessons from Piketty and New Insights from the HFCS. European Journal of Economics and Economic Policies: Intervention, 12(2), 204-219.
- Rothschild, K. W. (2002) The absence of power in contemporary economic theory, in : The Journal of Socio-Economics, 31, 433-442.
- Kesting, S. (2005). Countervailing, conditioned, and contingent--the power theory of John Kenneth Galbraith. Journal of Post Keynesian Economics, 28(1), 3-23.
- Scheve, K., Stasavage, D. (2017): Wealth inequality and democracy. Annual Review of Political Science, 20, 451-468.
- Jessop, B. (2012). Marxist approaches to power. The Wiley-Blackwell companion to political sociology, 33, 1.
Session 12 Conclusion and moving on All
- Topics: Course review; Discussion of strength and weaknesses of framework; Brief student inputs; Review of course readings; Outlook for the next term: initial discussion of students’ projects
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