United States income inequality: The concept of countervailing power revisited. Issue 1 (2nd January 2016)

• Record Type: Journal Article
• Authors: Brennan, Jordan
• Is Part Of: Journal of post Keynesian economics. Volume 39:Issue 1(2016)
• Page Start: 72
• Page End: 92
• Publication Date: 2016-01-02
• Subjects: Distribution -- distributive conflict -- income inequality -- institutional power -- market structure -- mergers and acquisitions -- union density -- work stoppages; B52 -- D3 -- J5 -- L1; 330.15
• DOI: 10.1080/01603477.2016.1148618
• Languages: English
• ISSNs: 0160-3477

Abstract

ABSTRACT: This article uses some of the conceptual infrastructure associated with J.K. Galbraith's "countervailing power" argument to explore the deep history of U.S. income inequality. Two explanatory variables—institutional power and distributive conflict—have played an integral role in the shifting patterns of U.S. income inequality since the late nineteenth century. The "commodified" power of large firms, manifested in aggregate concentration and the markup, exacerbates inequality while the "countervailing" power of organized labor, manifested in union density and strike activity, mitigates inequality. One implication of this research is that U.S. income inequality is unlikely to diminish unless the labor movement (or a comparable social movement) is strengthened.