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Supplemental material, sj-pdf-1-ilr-10.1177_00197939231181586 for Union Bargaining Power and Institutional Investors: Evidence from 20 OECD Countries, 1980–2017 by Yasmine Mohamed and Thibault Darcillon in ILR Review

The main objective of the paper is to investigate differences in individual support for political parties (left/right and specific parties) and to connect them to differences in support for various socioeconomic issues, such as redistribution, unemployment benefits, the perception of the level in inequality, immigration/globalisation and education spending. We use a large survey dataset from different International Social Survey Programme (ISSP) waves from 1985 to 2019 in 11 OECD countries. In the line of Amable and Darcillon (2021) who used a pooled sample of 20 OECD countries, we now focus on the country-specific characteristics of the support for the previous issues. Our results show that the transformation of the left-right divide into a competition between a brahmin left and a merchant right has not taken place everywhere. In many countries, the left has kept a popular support, even if there are some brahmin elements found in the broad left, mostly expressed through Green parties. Then, the policy preferences exhibit some common characteristics across countries. Unsurprisingly, the preference for redistribution is always negatively associated with higher income levels, except in Norway. Education often exerts a negative influence, sometimes for individuals with relatively modest income levels, which may point to the existence of an aspiration to upward social mobility. The preferences concerning more precise redistribution-related policies are more diverse according to the country considered. Some opinions (the tolerance towards inequality) or expenditures (unemployment benefits) are clearly regarded as pure redistribution and the expression of the preferences are parallel to those regarding the broad issue of redistribution. Other expenditures (education) are sometimes seen as a social investment and may be favoured by individuals with high income and education levels. Finally, immigration-related issues are usually taken the most obvious indicator of the possible existence of a brahmin left. In most, but not all, cases examined, education is indeed related with a positive opinion on immigration, whether it is considered good for the economy or not the cause of job substitution at the expense of the nationals.

Changes in the structure of political divides in developed democracies have been the focus of many studies in political science as well as in political economy. Some of these contributions argue that a new educational divide related with the attitude towards globalisation has supplemented and even sometimes replaced the traditional left/right cleavage. Piketty (2018, 2019) for instance finds that the left has become the party of the high-skilled and considers the emergence of a multi-elite party system: financially rich elites vote for the right (merchant right), high-education elites vote for the left (brahmin left). Using ISSP data for 17 countries, this paper tests the influence of income and education inequalities on political leaning and a variety of policy preferences: the support for redistribution, for investment in public education, for globalisation and immigration. Results show that income levels are still relevant for the left-right divide, but the influence differs across education levels. Our findings also point to a certain convergence of opinion among the brahmin left and the merchant right, which could lead to a new political divide beyond the left and the right, uniting a new social bloc, the bloc bourgeois.

International audience

International audience; This article analyses the linkages between financial development, labour market institutions and market income inequality for 18 Organisation for Economic Co-operation and Development countries over the 1980 to 2012 period. With the help of a dynamic panel data model with an interacted term, one crucial contribution of this article is to analyse the interacted impact of labour market institutions (i.e. union density and employment protection legislation) on the one hand and financial development on the other hand on the income distribution. Our results indicate that changes in the financial/credit and labour market regulation affect the income distribution. Estimates of the marginal effects show that by increasing labour market regulation one also weakens the impact of the flexibilization in the financial/credit market on the increase in income inequality.

This article proposes a re-interpretation of the political economy of financialisation in the OECD countries, which have experienced a continuous rise in income inequality. I show that changes in the income distribution may threaten the socio-political foundations of financialisation. First, whereas the continuous increase in income inequality maintain the alliance between financiers, managers and high-skilled workers intact to support the adoption of pro-minority shareholder, all the consecutive changes in financial and labour markets have produced increasing institutional incoherence and labour market dualisation, making the previous alliance more fragile. Second, despite stagnant incomes, middle-class and low-income households are in favour of higher financialisation because easy credit stimulates their consumption level. Encouraging credit supply contributes to the rise in household debt, thereby increasing workers’ vulnerability.

Adoptant une perspective de comparaison internationale au niveau macroéconomique, cette thèse a pour objet l'analyse des réformes de dérégulation financière et de corporate governance qui se sont opérées depuis le début des années 1970 dans l'ensemble des pays de l'OCDE. Alors que les modèles standards en économie s'intéressent aux effets d'efficience associés à une meilleure allocation des ressources, cette thèse exploite l'hypothèse de complémentarités institutionnelles afin de mettre en évidence l'impact des marchés financiers sur le marché du travail. À l'aide de modèles en données de panel, nos résultats font apparaître de forts transferts redistributifs associés aux réformes de libéralisation financière. La libéralisation financière, via notamment la montée en puissance des investisseurs étrangers, a eu comme principale conséquence de modifier le mode de financement des entreprises. En nous appuyant sur les complémentarités institutionnelles qui caractérisent les économies, nous montrons que l’adoption de ces réformes se traduit par une modification de l'équilibre institutionnel dans son ensemble en modifiant les rapports de force entre les différents agents. The dissertation proposes a cross-country analysis of financial deregulation reforms and corporate governance reforms in most of the OECD countries from 1970. Whereas standard models in economics tend to focus on efficiency effects this dissertation uses the institutional complementarity hypothesis to emphasize the impact of financial markets on labor market. Using panel data models empirical results thus indicate that financial reforms have strong distributive effects. Financial liberalization and the rise of institutional investors have directly affected the way of firms’ financing. It is argued that due to institutional complementarities the adoption of financial reforms is likely to affect the institutional equilibrium by modifying the balance of power between social groups.

International audience