Inherited institutions and the early American welfare state
Many recent policy proposals are variations on European programs implemented throughout the twentieth century. Despite their marked diversity, European welfare states share a foundation of social protections largely responsible for their lower rates of inequality. Theories on the development of this safety net, whether employee- or employer-driven, hold little explanatory power in the American context; they can't tell us why the US failed to expand the early pension system of the Civil War, or why protections for female workers and mothers preceded the sort of male oriented, class based policies which were common in Europe.
In her 1992 classic book, Harvard sociologist Theda Skocpol offers a compelling account of the development of modern social provisions in the United States. Conceptually, her narrative balances path dependency with historical contingency, stressing the "fit" between politicized group formations and the design of government institutions.
A brief summary of her conclusions, from the introduction:
"In certain European countries, state bureaucratization preceded the emergence of parliamentary parties, or the democratization of the male electorate. When political parties emerged in such circumstances, they had to make programmatic appeals to collectively organized constituents, including organized workers. Circumstances were sharply different in the 19th century United States, where no pre-modern centralized bureaucracy held sway, and where full democratization of the electorate for white males was virtually completed nationwide by the 1840s.
Because they were already voting, American workers did not need to mobilize along class lines to overcome exclusion from suffrage. But patterns of exclusion from electoral politics shaped the possibilities of women's political consciousness. National and local groups claiming to speak for the collective interests of women were able to mount ideologically inspired efforts on behalf of maternalist welfare policies, outside of parties or regular electoral politics."
Link to the publisher page.
- In their more recent, widely cited paper, Alberto Alesina, Edward Glaeser, and Bruce Sacerdote trace the weakness of America's welfare system to race, concluding: "Racial animosity in the US made redistribution to the poor, who are disproportionately black, unappealing to many voters." Link.
- More on Civil War pensions: A focused analysis from Skocpol in 1993, and a detailed legislative history submitted as a PhD dissertation by John William Oliver in 1917. Link and link.
- "By the turn of the 20th century, more than 350,000 women were gainfully employed in New York City, making it the largest urban concentration of female workers in the country. The Women's Trade Union League of New York served as an important training ground for working women and upper-class social reformers alike." Nancy Schrom Dye on the WTULNY and the cross-class alliances it forged. Link.
New Researchers: COMBINED EQUILIBRIUM
Currency unions and the inflationary effects of Independent Central Banks
Our early June newsletter considered the politics of central bank independence (CBI). In her job market paper, Economics PhD candidate CHRISTINE OLIVIA STRONG develops a novel measure of CBI in order to determine it's impact on price stability in 30 African countries—12 members, and 18 non-members of the CFA currency zone.
From the paper:
"This paper develops a new measure of CBI based on both the turnover rates of central bank governors and measures of alliance with the government in power. We find that Central bank governors in non-CFA countries are 2.4 times more likely to be prematurely removed than governors in CFA countries, and that a higher turnover rate leads to an increase in inflation in both the full sample and the non-CFA countries."
Each week we highlight great work from a graduate student, postdoc, or early-career professor. Have you read any excellent research recently that you'd like to see shared here? Send it our way: firstname.lastname@example.org.
- "The idea that student debt cancellation is a giveaway to the rich just isn’t sustainable in the data." In this week's Phenomenal World post, Marshall Steinbaum disputes the regressivity of recent proposals to cancel student debt. Link.
- Jessica Morley and Luciano Floridi examine the ethics of integrating "algorithmically-driven interactions between human, artificial, and hybrid agents" into the existing infrastructure of Britain's NHS. Link.
- "If monopsony is pervasive under conditions of laissez-faire, antitrust is likely to play only a partial role in remedying it, and other interventions in the labor market will be required." Suresh Naidu and Eric A. Posner on the limitations of anti-trust laws. Link.
- Of 300 colleges surveyed, 75% of financial aid applications are "unreadable by high school graduates of average reading comprehension ability" according to research by Z. W. Taylor, perhaps helping to account for the $2.6 billion in Pell grants which went unclaimed in 2018. Link.
- "The 1917 Russian Revolution, followed by the end of World War I, saw a pan-European refugee crisis as millions of Russians fled abroad. After World War II, Europe was flung into crisis once again, with 30 million people displaced across the continent." Eilish Hart analyzes the postwar origins of contemporary refugee protections. Link.
- A new paper by Eric James Stokan finds that "state level EITCs may not be large enough to realize positive economic gains." Link.
- "We investigate the wage, employment and reallocation effects of Germany’s first-time
introduction of the nation-wide minimum wage, finding that it raised wages and did not lower
employment." New research from Christian Dustmann, Attila Lindner, Uta Schönberg, Matthias Umkehrer, and Philipp vom Berge. Link.
- Georgia State University researchers Dan Immergluck, Stephanie Earl, Allison Powell, and Jeff Ernsthausen analyze the use of 'serial' eviction filings, used to "discipline the tenant through state-sanctioned threat of removal." Link.
- David Arnold considers the consequences of Jair Bolsonaro's planned privatizations for Brazil's vulnerable workers. Link.
- "In the 1950s and 1960s, the U.S. government paid the economics department at the University of Chicago, known for its advocacy of free markets and monetarism, to train Chilean graduate students. These students became known as the “Chicago Boys,” who implemented the first and most famous neoliberal experiment in Chile after 1973. Peruvian, Mexican, and other Latin American economics students followed a similar path and advocated a turn to neoliberal policies in their own countries. The Chicago Boys narrative has become an origin story for global neoliberalism. However, the focus on this narrative has obscured other transnational networks whose ideas possess certain superficial, but misleading, similarities with neoliberalism. I examine Chilean and Peruvian engagements with Yugoslavia's unique form of socialism, its worker self-management socialism, which was part of a worldwide discussion of anti-authoritarian socialism. I first introduce the Yugoslav socialist model that inspired those in Chile and Peru. I then examine socialist discussions in Chile and Peru that called for decentralized, democratic socialism and looked to Yugoslavia for advice. I conclude by examining the 1990s postponement of socialism in the name of a very narrow democracy and realization of neoliberalism." by Johanna Bockman. Link.