Class Conflict and Inequality


in It's Not Over

Published in print January 2013 | ISBN: 9780198088417
Published online January 2013 | e-ISBN: 9780199082292 | DOI:
Class Conflict and Inequality

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Chapter 1 explains the forces behind increasing inequality (increasing share of income of capitalists) by presenting a theoretical model to show how the income share is divided between workers and capitalists. In an advanced capitalist country, income share of different classes is decided by their respective bargaining strength. For workers, it is decided by their unemployment rate (Marx’s argument on the reserve army of labour) and for capitalists, the extent of collusion among them. The concept of non-accelerating inflationary rate of unemployment (NAIRU) is used to build the basis of a theoretical structure. This chapter argues that the increase in income inequalities is a result of a decline in the strength of the working class in the first world as a result of globalisation, which ensured that the size of the reserve army is no more restricted to the national boundaries alone.

Keywords: class conflict; workers; capitalists; income distribution; reserve army; NAIRU; globalisation; Karl Marx

Chapter.  3371 words.  Illustrated.

Subjects: Macroeconomics and Monetary Economics

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