DYNAMICS OF WELFARE CAPITALISM: SMALL WEST EUROPEAN STATES AND SOUTH KOREA*

Jae-Hung Ahn and Jong Hee Park

INTRODUCTION

Is it possible to maintain a virtuous cycle of employment growth and social protection in globalization? If the answer is yes, what types of income and social policies, both of which constitute a policy regime, were required? The goal of this paper is to answer these questions.

In the comparative political economy literature, there are two theories that hint paths to the virtuous circle between employment growth and social protection in the era of globalization. First, the theory of social investment state (SIT) argues that economic, social, and labor market policies can be linked with each other to bring forth a virtuous circle between economic growth and social welfare. Second, the varieties of capitalism (VOC) approaches underscore that “the productive function of social protection” has been overlooked in finding a path to the virtuous cycle of employment growth and social protection. According to VOC, the existing studies have focused too much on redistribution as the main goal of welfare state policies (Ebbinghaus and Manow 2001, 2).

Although theories of SIT and VOC are sharply divided over what policy tool would bring forth the virtuous circle between employment growth and social welfare, neither approach attempts to link social policies with income policy, a core policy having sustained employment growth in the Western European countries since the World War II. We argue that the focus on social policies could be misleading in finding a path to a virtuous cycle between employment growth and social protection in globalization. We show that CME countries in Western Europe could achieve the virtuous circle between employment growth and social welfare by linking social policies with wage restraining income policy. Social policy alone, regardless of whether it is ALMP-centered or PLMP-centered, does not always produce the virtuous cycle. Wage restraining income policy is a necessary condition for the virtuous circle between employment growth and social protection.

As our theory involves a test of a necessary condition, we employ Ragin’s method of Boolean algebra analysis to identify “an order-in-complexity”－a necessary condition－penetrating the diverse combinations of variables that bring forth the same phenomenon (Ragin 1987; Ragin 2000; Braumoeller and Goertz 2000; George and Bennett 2005) According to Ragin, interaction effects are hard to correctly grasp with quantitative methods because the interaction effects turn out to produce different outcomes depending upon the socio-political contexts.

* Paper presented at the Conference of International Political Science Association at Madrid, Spain on July 10,

2012. Citation is prohibited without author’s permission. Jae-Hung Ahn, Department of Political Science and Diplomacy, Division of Social Sciences, Ajou University, Suwon, Republic of Korea; Jong Hee Park, Department of Political Science, University of Chicago, Illinois, USA.

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In order to explore the conditions of the virtuous circle of employment growth and social welfare, we need to not only test the combination of policies conducive to the virtuous circle but also explain the paradoxical interactions between policy and politics across the regimes of welfare capitalism. In CMEs, income policy is made based on a consensus among tripartite actors. Once the goal of the income policy i.e., full employment, is achieved, however, labor unions would not accept the institution of wage restraint peak organizations had controlled through centralized wage bargaining (Scharpf 1991, 170-1). Thus conflicts among tripartite actors ensue. Thus, we conduct a comparative historical analysis across five small states in Western Europe, Sweden, Denmark, Netherland, Austria, and Ireland, to verify the Boolean algebra analysis. We conclude by summarizing implications from this analysis and to the Korean case.

HYPOTHESES

To achieve a virtuous cycle of employment growth and social protection, proponents of SIT generally believe that certain orthodox economic policies such as monetarism, deregulation, and labor flexibility are imperative. However, proponents of SIT depart themselves from neo-liberalism by emphasizing the role of the government to get rid of ‘social exclusion’ and thus to buttress ‘social cohesion.’ Specifically, SIT argues that governments should intervene in the supply-side of economy, through active labor market policy (ALMP), and reinforce family policies, thereby moderating ‘social exclusion’ (Giddens 1998; Midgley 1999; Jenson and Saint-Martin 2003; Esping-Anderson 2005; Taylor-Gooby 2006). The idea of SIT was first taken by the Labor Party under Tony Blair in 1998, followed by other center-left parties in the liberal welfare states (Lister 2004). In 2000, the Lisbon European Council promulgated its will and plans to invest in people and develop an active welfare state (Eruopean Council 2000; Vandenbroucke and Vleminckx 2011).

VOC scholars argue that depending upon the type of production regimes, the supply-side economy can be complemented by social welfare policies. For example, in countries with coordinated market economy (CME), employers have not always opposed to such social policies as public unemployment insurance and pension because they believe that the skilled unemployed could be hired whenever they need to if social insurances hold them outside the labor market. In this way, a production regime and a welfare regime have been linked in complementary ways, thereby forming a “welfare production” regime (Estabez-Abe et al. 2001, 146; Pierson 2001; Hall and Soskice eds. 2001; Ebbinhaus and Manow eds. 2001; Mares 2003; Iversen 2005). Unlike SIT, which emphasizes the positive role of ALMP, VOC scholars emphasize the positive effects of passive labor market policy (PLMP).1

Theories of SIT and VOC are sharply divided over what policy tool would be best to produce the virtuous circle between employment growth and social welfare in the face of globalization. However, both of them fail to consider an important policy that has sustained employment growth in the Western European countries since the World War II: wage restraining income policy. In fact, as we will show shortly, CME countries in Western Europe could achieve the virtuous circle between employment growth and

1 PLMP refers to such policies as unemployment insurance, disability insurance and pension, which aid

labor market outsiders. ALMP indicates policies promoting job training and job searching, and assisting firms to absorb unemployed in the labor market. PLMP exerts the policy effects of holding unemployed outside the labor market, whereas ALMP induces unemployed to search for jobs within the labor market.

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social welfare in the face of globalization by linking social policies with wage restraining income policy. Thus, we argue that social policy alone, regardless of whether it is ALMP-centered or PLMP-centered, does not always produce the virtuous cycle and wage restraining income policy is a necessary condition for the virtuous circle between employment growth and social protection.

Hypothesis 1: Wage restraining income policy is a necessary condition for the formation of the virtuous circle between employment growth and social welfare.

Second, social investment could accomplish the elimination of social exclusion only

when it is combined with PLMP. This is because, as VOC approaches argue, social expenditures in PLMP are complementary to the supply-side of economy, and because ALMP alone does not reduce social inequalities.

Hypothesis 2: The elimination of social exclusion in social investment policy regime

is possible only when social investment policies are combined with PLMP. Our study takes unemployment as the dependent variable to measure economic

performance. Thus, our empirical analysis investigates the interaction effects of social policy with income policy on changes in unemployment.

EMPIRICAL ANALYSIS

Typologies and Empirical Correlations We classify the combination of income policy and social policies into several types to analytically shed light on the virtuous circle between employment growth and social welfare. First, income policy is categorized into three types: 1) non-income policy in LME; 2) income policy restraining wages of every group; and 3) solidaristic income policy restraining high wages but raising low wages.

Labor market related social policies are classified into ALMP and PLMP as shown in Table 1. PLMP supports labor market outsiders. If the resources expended in PLMP are transferred to investments in ALMP to a far extent, rates of unemployment may decrease, but social inequalities may also be aggravated. This is because competition among low wage earners would be in intensified in the labor market, thus widening wage gaps.

Based on the above typology, we hypothesize policy effects of each category in Table 2. Under LMEs, the strategy of social investment is to reduce expenditures in PLMP but increase investments in ALMP. In this case, conditions of employment may be enhanced, but social inequalities may be aggravated. XI and I are interesting cases because policy effects are the same although they adopt different combinations of policies. In case XI, there may be serious wage inequalities even though the overall levels of wages are restraint. Instead, the state compensates for low wages by such measures as PLMP and transfer payments. In contrast, the case I combines the income policy of solidaristic wages with a middle level of expenditures in PLMP and with a high level of expenditures in ALMP. As long as solidaristic wage policy is successfully implemented, full employment and social equality can be achieved. But if it fails, however, economic and/or social turmoil may follow. If the solidaristic wage policy turns out to be not implementable, there must be a fundamental restructuring of social

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policies. Otherwise, the country would suffer from inflation and unemployment, as the Swedish case in the beginning of the 1990s showed.

Wage coordination and unemployment are correlated. On the one hand, if there is no non-market wage coordination as is in LMEs, wages are widely dispersed and unemployment tends to be low. In contrast, the existence of non-market institutions that reduce wage dispersion such as solidaristic wage policy raises wages in less productive sectors while compressing wage demands in productive sectors. Had not been state intervention in the labor market either by ALMP or by PLMP, the levels of wages would be negatively correlated with rates of unemployment. This is because wage increases in the low-wage industries would provoke unemployment.

<Figure 1> shows that wage dispersion measured by the ratio of the gross earnings received by the worker at the 50th percentile to those at the 10th percentile (P50P10) is positively correlated with unemployment before globalization. This positive correlation implies that the states in CMEs intervened in the labor market with PLMP to hold unemployed outside it, or with ALMP to assist unemployed to search for jobs within the labor market. But the correlation was reversed after globalization as shown in <Figure 2>. Although the pattern is less clear, the two variables are negatively correlated if we do not take into consideration the several countries of CME located underneath the negative slope: Sweden, Denmark, Norway, and Switzerland. Those countries maintaining low unemployment and wide dispersion of wages mostly belong to those of LMEs. This implies that social investments in ALMP contributed to the reduction of unemployment to a certain extent. At the same time, however, those countries of CMEs mentioned in the above still kept both narrow dispersion of wages and low unemployment. As far as OCED countries are concerned, that is, two types of unemployment regimes coexist in the era of globalization.

However, the correlation between wage dispersion and unemployment does not contain any information regarding the effects of social policies. Using comparative method, we analyze the effects of income policy and social policy. First, we rely on Esping-Andersen’s typology of welfare capitalism to select most similar cases, thus controlling the influences of other independent variables. Among the most similar cases, then, we select the cases that are distinctively different as far as our theoretical variable(s) is concerned. For this, we compare Esping-Andersen’s typology with the typology of policy regimes in <Table I>.

Esping-Andersen classifies welfare capitalism into three types: the liberal welfare state, the conservative welfare state, and the social democratic welfare state. His typology is based on two theoretical variables: decommodification and social stratification. We may simplify Esping-Anderson's arguments as in <Table 3>. The two variables -- social stratification and decommodification -- in Esping-Andersen’s typology focus on politics of interests in the sphere of the demand-side of economy and provide a theoretical framework on how social classes came to secure their social rights of welfare through political and social struggles (Esping-Andersen 1990).

In <Figure 3>, X-axis indicates the variable of wage dispersion among low and middle wages－P50P10. Y-axis measures the extent to which social policies are concentrated on ALMP－the ratio of ALMP in terms of a percentage of GDP by those in PLMP in terms of a percentage of GDP. The arrows indicate the changes between the year 1980 representing pre-globalization period, and the year 2000 representing the globalization period. By and large, after globalization, wage dispersion became larger,

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and the ratio of ALMP was shifted up. What is theoretically intriguing us is that Denmark and Austria deviated, respectively, from those countries belonging to the same category in Esping-Andersen’s typology, and that policy regimes in the UK and Ireland were shifted closely to type II. In case of Ireland, wage dispersion reduced a lot. This was because tripartite actors negotiated wages through a series of social pacts after 1987. However, the level of wage dispersion remains relatively large. It seems that the shift in Austria is overestimated. There are two different sources of P50P10 data from OECD; one for the pre-1994 period, the other for the post-2004 period. The two sources show very different levels of P50P10 (Huber et al. 2004; OECD). <Table 4> simplifies empirical relations in a typological form.

Comparison of Cases and Identification of a Necessary Condition Let us compare the cases we discussed in the above on the basis of Mill’s methods of difference. If two cases “have every circumstance in common save one” and differ in “the presence or absence of the phenomenon we wish to study” (the dependent variable), the circumstance that solely differs is “the effect, or the cause” of the phenomenon (Mill 1974 (1834), 390-91). Sweden and Denmark belong to the same type of welfare capitalism in Esping-Andersen’s typology. As <Figure 3> showed, however, the two countries differed distinctively before globalization as far as social policies regarding the labor market were concerned. As a strategy of accomplishing full employment, Sweden adopted ALMP-centered labor market social policies whereas Denmark relied on PLMP-centered social policies. After the first-oil shock of 1973, however, the two countries bifurcated in terms of unemployment (<Figure 4>). There are also other combinations of cases to which the method of difference can be applied (see <Table 5>).

If we follow Mill’s logic, the difference in social policies is a causal factor that gave rise to the difference in the rates of unemployment. A terminal shortcoming inherent in Mill’s method of difference is that since it employs the technique of eliminating agreeing circumstances as a candidate causal factor until only one disagreeing circumstance is left, we cannot verify whether or not there is an interaction effect and whether or not there is more than one factor affecting the dependent variable (Liberson 1991). For example, Sweden and Denmark differed not only in the types of social policies but also in the implementation of income policies after the first-oil shock of 1973. Sweden continued to implement solidaristic wage policy while Denmark did not. In the 1970s, Denmark was engulfed in industrial conflicts and failed in striking centralized wage bargaining as many as four times (1973, 1975, 1977, and 1979) (Stokke and Thörnqvist 2001, 253-54; Elvander 2002, 123). Therefore, we cannot verify whether high unemployment was triggered due to PLMP-centered social policies or failure of income policy, or due to the interaction effect between the implementation of PLMP and the failure of income policy.

Ragin argues that the causal complexities produced by interaction effects can be disentangled using Boolean algebra. That is, we can “decipher the order-in-complexity” by identifying a necessary condition penetrating the complex interactions (Ragin 1987, 29). <Table 6> displays the combinations of nominal variables affecting low unemployment U(1) or high unemployment u(0). We divide the whole period since World War II into three sub-periods on the basis of two historical events: the first oil-shock of 1973 and globalization starting the mid-1980s. In case of Ireland, we take only the third period into consideration. Since Ireland had not formed any income policy

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until 1987, we cannot discuss failure or success of income policy before the era of globalization.

The combinations of variables that bring about low unemployment U(1) are as follows:

U = ApI + aPI + API = I(Ap + aP) + API If being combined with I, both Ap and aP are related to low unemployment. Thus,

I(Ap + aP) is minimized into I. Therefore, U = I + IAP That is, I is a necessary condition for low unemployment U(1). A cause is defined

as necessary “if it must be present for a certain outcome to occur.” (Ragin 1987, 99). High unemployment occurs when variables are combined either way as in the

below, thus producing the following interaction effects. u = aPi + APi = Pi(a + A) If employing the method of minimization, then u = Pi That is, the interaction effect between failure of income policy and the

implementation of PLMP-centered social policies is a necessary condition for high unemployment u(0) (Ragin 1987, 99-100).

The Social Investment State and Social Inequalities The strategy of social investment state shows ambivalent performances. It contributed to reducing unemployment, thus raising the rates of labor participation (<Table 7>). Our hypothesis that it would deepen social inequalities is corroborated by empirical data (<Table 8>). In the liberal welfare states, which adopted the strategy of social investment, social inequalities were not improved but more or less deteriorated. It was after around the mid-1990s that the liberal welfare states got down to implementing the strategies of the social investment state. After the mid-1990s, however, British social performances got worse in terms of Gini-index even though her records remained at considerably high levels. In Ireland, Gini-index was slightly enhanced but still recorded high, though, whereas poverty rate went up. Consequently, although social investments in the liberal welfare states contributed to reducing unemployment rates, they did not contribute to improving social inequalities that had already reached an apprehensively high level.

It is hard to make a clear evaluation of the social performances of the countries that combined ALMP and PLMP. Social inequalities in Sweden and Denmark remained at low levels in comparison with those in other countries. After the mid-1990s, social inequalities in Denmark did not get worse to the same extent as Sweden did. The Swedish case revealed an ironical outcome. Sweden has invested considerable amounts

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of resources in ALMP. For example, 2.7 percent of GDP was spent in ALMP in 1977. In the beginning of the 1990s, however, unemployment rates increased dramatically, which in turn brought about a sharp increase in social expenditures in PLMP (<Figure 3>). Although the total social expenditures in PLMP increased, replacement rates in PLMP such as unemployment insurance and pension were reduced (Andersen 2001), which seemed to deteriorate social inequalities. The problem in Sweden is that social investment in ALMP no longer contributes to improving unemployment and that reduction in social welfare per capita aggravates social inequalities.

A comparison of the Danish, the Dutch, and the Austrian cases is theoretically intriguing. What the three cases have in common is the fact that they had adopted PLMP-centered policies until the era of globalization began. But since then they have taken different paths. Denmark has kept a balance between PLMP and ALMP, the Netherlands has skewed toward the social investment state, and Austria has continually been stick to PLMP-centered social policies. In fact, the ratio of ALMP/PLMP may not be an accurate indicator in that it hides the sizes of expenditures in ALMP and PLMP. As of year 2000, it was Denmark that kept a balance between ALMP and PLMP, and successfully implemented wage-restraining coordination. In Denmark, the ratio of PLMP in terms of a share of GDP was as high as 4.9 percent in 1980, has since 1994 decreased moderately and reached 3.0 percent in 2000 (OECD). In contrast, the ratio of PLMP in the Netherlands had remained about 3.0 percent but began to sharply decrease after 1996 till 1.3 percent in 2000.

Denmark has not only implemented a strategy of social investment state but also kept a ‘welfare production regime.’ In contrast, the Netherlands has skewed towards the social investment state and also allowed a larger leeway for wage bargaining to be more flexible (<Figure 3>). These differences were reflected in social inequalities. Although both countries enhanced employment conditions, Danish societies were more equal than Dutch societies were. As mentioned, Austria has employed the strategy of holding labor market outsiders by PLMP and compensated for wage restraints of low-wage groups by transfer payments. From the start, Austria did not aim at a high level of social equality as the social democratic state did. Furthermore, slight increase in unemployment after the mid-1990s provoked further deterioration of social inequalities. Social inequalities in Austria, however, have remained much lower level than those in the liberal welfare states.

A COMPARATIVE CASE STUDY

Formation of Tripartism and Policy Regimes during the Golden Age of Capitalism Although social democratic parties and the labor movements took the lead in shaping welfare capitalism, Sweden and Denmark institutionalized tripartite relations that were distinctive with each other. The term “centralized self-regulation” encapsulates Swedish tripartite relations: LO and SAF led the centralized wage bargaining without allowing for state intervention (Kjellberg 1998). Based on tripartite concertation, the social democratic party launched the Rehn-Meidner model after 1957. The uniqueness of the Rehn-Meidner model lay in its solidaristic wage policy. The solidaristic wage policy was assumed to provoke unemployment in the low-wage industries. The Rehn-Meidner model suggested that with ALMP, the state assists the unemployed in getting better jobs in advanced industries. The advanced industries were to have a large leeway to absorb those unemployed if their skills were upgraded by ALMP. This is because the policy of

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lowering high wages, i.e., låglönelinje, was to accrue extra profits to them (Elvander 1988, 35-6; Hedborg and Meidner 1984, 74-85). That is, the solidaristic wage policy played a key role in linking income policy with ALMP-centered social policy. Public expenditures on ALMP went over 1 percent of GDP as early as 1970 and reached as high as 2.5 percent in 1977. In contrast, public expenditures on PLMP did not exceed over 0.4 percent of GDP in the 1970s (Furåker and Lind 1990).

Danish tripartite relations and wage bargaining system located somewhere between the Swedish system of self-regulated centralization, on the one hand, and Austrian system of ‘organized decentralization’ allowing for indirect intervention by the state, on the other hand. In 1934, the amended Act stipulated that if the wage bargaining between LO and DA failed, the Parliament could enforce an extension of the existing agreement, or acceptance of the proposal of the Public Conciliator. The amended Act contributed to centralizing Danish industrial relations, but, at the same time, shifted the locus of Danish industrial relations to the levels of industries. This is because the Public Conciliator was to make a proposal based on the method of “concantenation,” which linked and pooled the votes cast by industrial labor unions (Due et al. 1994, 95-118). Danish income policy also pursued solidaristic wages, but wage dispersion was not as narrow as the Swedish one was. In fact, the centralized wage bargaining raised low wages to a certain extent, the wages of unskilled wage earners in particular. Allowing for multi-industrial negotiations, however, it did not effectively constrain high wages (Mats and Bundgaard Vad 2000, 411; Due and Madsen 2000, 24). Although having pursued the income policy of solidaristic wages as Sweden did, Danish labor market policy was concentrated on PLMP. For example, public expenditure on ALMP remained at the level of 0.2 percent of GDP, but public expenditure on PLMP went over 2 percent and reached close to 3 percent of GDP in the 1970s. In particular, the state subsidized more than 90 percent of unemployment insurance funds, which were managed by labor unions (Furåker and Lind 1990; and Scheuer 1992, 192).

Dutch tripartite relations were an outcome of political compromises. In October 1945, the state promulgated “the revised Extraordinary Decree on Labor Relations” (BBA). The BBA empowered “the Board of Government Mediator” to “approve or reject the terms of a collective agreement or to ‘extend’ them (Windmuller 1969, 286-87). In reaction to such a radical initiative of the state, the three―socialist, Catholic and Calvin－union movements and employers’ associations founded “the Foundation of Labor” (STAR) in October, 1945. They demanded that industrial relations be regulated by STAR. Finally, tripartite actors made a compromise and founded a system of centralized wage bargaining in which the norms of both state intervention and self-regulation were permitted. Dutch income policy was successful. The coverage of collective agreements rose from 15 percent in 1940 to 70 percent in 1962. In 1960, Dutch aggregate wages turned out to be lower 20~25 percent than those in Germany and Belgium (Windmuller 1969, 270-75; Visser and Hemerijck 1997, 92-3). In the meanwhile, the Netherlands concentrated on PLMP-centered labor market policies as Denmark did. In particular, a program of worker’s disability was enacted in 1967, which absorbed workers very fast due to generous criteria, exceeding 8 percent and reaching as high as 18 percent of the total labor force in 1980 (Cox 1998, 406; Visser and Hemerijck 1997, 126).

Austrian income policy was unique even among the West European countries. Austrian corporatism was well institutionalized based on the highly concentrated and

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centralized organizational structures of the union movement. Austrian wage dispersion, however, was wider than that of any other CMEs, being close to the LMEs (see <Figure 3>). Ironically, wage inequalities were propelled by income policy. In the 1950s, wage inequalities in Austria were lowest among West European countries. However, in the 1960s and the 1970s, wage dispersion in Austria was so enlarged as to record the widest among West European countries (Pollan 1997, 57-8). Austrian wage bargaining system has been characterized by “organized decentralization.” There was no centralized wage bargaining. The law of collective bargaining conceded the right of collective bargaining only to occupational associations. However, in reality, the coordination of wages on the levels of industries and firms were much influenced by two institutions: 1) The Austrian Confederation of Labor Unions (ÖGB) and 2) the Parity Commission for Wages and Prices. ÖGB took the system of wage bargaining not as an instrument of distribution but as a policy tool to secure wage earners from unemployment. ÖGB was not aimed at raising low wages. Rather, it sought to promote employment growth and entrusted the political sphere, the Parliament in particular, with the task of distribution (Flanagan et al. 1983, 52-6; Tálos and Kittel. 1996, 35; Scharpf 1991, 33-6; Traxler 1998). For example, although having enjoyed very low unemployment rates, the Austrian state expended about 15 percent of GDP on transfer payment whose rate was highest in the Western European countries (Huber and Stephens 2001, 88-9, 278).

Reactive Sequences after the end of the 1960s In Sweden, the endogeneity provoking a backlash against centralized wage bargaining resided in the income policy of solidaristic wages and in its linkage with ALMP. The Swedish policy regime implied that many wage earners in low wage industries had to incur unemployment, temporarily though. Thus, workers’ reactions in Sweden were particularly severe. After around the end of the 1960s, protests against the Swedish model arose among those workers who had to suffer from wage-cut and whose working conditions got worse due to the rationalization of production. Miners launched wildcat strikes in 1969, which inflamed other wildcat strikes over the country until the mid-1970s. Those who participated in the strikes resisted centralized wage bargaining. They also demanded that LO’s right to decide strike be transferred to local labor unions (Swenson 1989, 84-95; Kjellberg 1998, 31; Korpi 1981, 71 and 79).

To cope with the intra-organizational reactions, LO took a series of strategic actions. Among them was the strategy of reinforcing the system of solidaristic wages by compressing inter-union wage differences. LO expected it to consolidate the solidarity of the working class. In its collective agreement with SAF in 1969, LO demanded that wages be leveled regardless of occupation and labor and that ‘the clause of income security’ be stipulated in the collective agreements of those labor unions which could not take advantage of ‘wage drifts’―“extra-contractual increase” (Swenson 1989, 145; Elvander 1988, 35, 45-7 and 88-9). But LO’s move provoked a series of reaction by labor unions outside its umbrella. In the mid-1970s, public sector unions and white-collar unions also demanded for the insertion of the income security clause in their collective agreements. Intra-union wage struggles took place disorderly along the labyrinth of complex wage negotiation processes. Eventually, the Metal Workers' Union Federation, the largest affiliate of LO, left centralized wage bargaining round in 1983. It struck a collective agreement autonomously with the Engineers’ Association (VF) (Swenson 1989).

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In Denmark and the Netherlands, reactive sequences proceeded differently from Sweden. As mentioned, the two countries had opted for a policy regime combining income policy and PLMP-centered social policies (see <Figure 3>). This policy regime turned out to be vulnerable to the exogenous shock by the 1973 oil crisis. Unemployment skyrocketed immediately after the oil crisis (see <Figure 4>; Esping-Andersen 1996). The states in Denmark and in the Netherlands attempted to restrain wages through the centralized wage bargaining of corporatism. Both occupational and industrial union federations vehemently opposed to the initiative of the state. But under the support of the social democratic government and LO, the Public Conciliator and the Parliament intervened in the wage bargaining processes. Occupational and industrial union federations both protested against state intervention, demanding that the wage bargaining issue should not be politicized. The efforts of LO to strike centralized wage bargaining with DA (Danish Employers’ Association) aborted four times—1973, 1975, 1977, and 1979-- in the 1970s. In 1973, more than 250 thousands workers participated in labor strikes for four weeks in defiance of centralized wage bargaining (Due et al. 1994, 131; Flanagan et al. 1983, 469-78; Stokke and Thörqvist 2001, 253-54; Elvander 2002, 123; Scheuer 1992, 186-87).

In the Netherlands, as low unemployment turned out to last long, both labor and capital began to oppose to centralized wage bargaining and state intervention. In the early 1960s, even the socialist union block, NVV, changed its position and supported the decentralization of wage bargaining. NVV proclaimed that it would no longer return to the system of the past to realize full employment. The state amended BBA and sought to exert statutory control in order to enforce wage restraint. According to the amended Act, STAR was authorized to regulate wage bargaining. Not only the union movements but also employers protested against the issue of statutory control. In fact, STAR did not intervene in wage bargaining. In 1968, the state sought to directly enforce wage restraint through the legislation of the new Wage Act. In protest, NVV and the Catholic union block NKV withdrew from STAR. By the end of the 1960s, the institution of centralized bargaining stopped working (Windmuller 1969, 301-02; Flanagan et al. 1983, 136-7; Visser and Hemerijck 1997, 94).

The policy regime of combining income policy and PLMP-centered social policies did not necessarily end up with an undesirable consequence. Austria is a case in point. As mentioned, Austria opted for a policy combination of income policy and PLMP-centered social policies. Even in the 1970s in which oil shock hit twice, unemployment remained relatively low, and labor unions, nevertheless, did oppose to wage bargaining system. How was it possible? We may find an answer from the unique structure of the union movement. ÖGB was an encompassing organization covering all the union blocks pursuing diverse ideologies. It seems that ÖGB sought to concentrate itself on linking wage restraint and employment, which was relatively easy to accord, leave the intransigent issue of social equality to the political sphere. In fact, the state compensated for wage restraint with transfer payments generously. Despite very low rates of unemployment, the proportion of transfer payments out of GDP in Austria was much higher than in Sweden and Demark during the 1980s-1990s (Huber et al. 2001). Globalization and the Tripartite Relations in Transition During the period between the 1980s and the 1990s in which globalization swept over Europe, the socio-political contexts for income policy as well as tripartite relations

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changed substantially. When suffering from high unemployment, the union movement tends to have interest in resuming income policy through tripartite concertation because unemployment weakens its organizational capacity (Franzosi 1995, 31; Korpi 2002). In this situation, the historical timing when globalization hit the economy would affect whether or not tripartite concertation would be successfully resumed. Globalization tipped the balance of power between labor and capital toward the latter whereas labor had held sway over capital before globalization. In case that tripartite concertation was resumed before globalization, it would be likely for the concertation to continue even after globalization. To the contrary, in case that the conflict between labor and capital continued to take place after globalization, tripartite concertation would not be easily resumed even under economic recession. Being relatively mobile, capital would not be institutionally entangled with corporatism any more even if the latter seeks to revive tripartite concertation.

In addition, globalization has transformed the characteristics of tripartitism. Tripartite concertation in the era of globalization proceeds without passing the labyrinth of interest intermediation within and between interest groups. This new development of tripartite concertation is conceptualized in terms of ‘social concertation’ (Compston 2001; Hassel 2003). The state and peak organizations strike a political deal in the form of social pact. Social pact covers a wide range of issues such as skill training, labor market policy, social security as well as wages. Since social pact was made by a political deal, social concertation bypassed the processes of interest intermediation. Thus, social pacts have been made in those countries previously categorized as weak corporatism: Ireland, the Netherlands, Italy, Spain, and Portugal (Fajertag and Pochet 2000; Baccaro and Simoni 2008).

In Sweden, LO went on offensive against SAF till the beginning of the 1990s when unemployment skyrocketed to 8.2 percent. Entering the 1980s, SAF began to retaliate on LO. After a large-scale lockout turned out to be a failure in 1980, SAF took steps to break down Swedish corporatism itself. In 1983, SAF already allowed VF to make a cross-class coalition with the Metal Workers' Union Federation, dismantling the centralized wage bargaining round. In the meanwhile, SAF participated in the 1979 election campaign aggressively to scuttle LO’s efforts of enacting the wage earners’ fund. In 1991, SAF made an official decision to withdraw its 6,000 representatives from corporatist institutions (Elvander 1988, 53-4; Stråth 1998, 179-203; Johansson 2000, chs. 4-5). SAF is still negative to centralized wage bargaining. It rejected LO’s proposal for ‘a coalition for growth’ in 1998 (Stephens 2000). Although Sweden has managed to coordinate wages through industry-level wage bargaining in which unofficial public mediator intervened, a new collective bargaining regime has yet to be institutionalized, suffering from conflicts every bargaining round (Elvander 2002; Ibsen et al. 2011). Furthermore, since 1976, governments have been alternated between two ideological blocs of left and right parties. Interest groups, in turn, tended to concentrate themselves more on lobbying the Parliament and political parties than on reviving corporatism (Hermansson et al. 1999; Svensson and Öberg 2002; Anthonsen et al. 2011).

In Denmark, tripartite actors had taken a path towards concertation before globalization. LO no longer took issue with DA in 1979 when the Social Democratic Party failed in enacting a Swedish-style wage earners' fund. Rather, LO accepted DA's demand that wage bargaining be more decentralized. In 1987, the state, LO and DA struck a social pact－‘joint declaration’― that labor costs in Denmark should not be

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higher than those in competing countries. LO and DA abided by the norm of the joint declaration until LO withdrew them (Anthonsen et al. 2011, 124; Due et al. 1994, 190-1; Scheuer 1998, 162-3). Furthermore, since the beginning of the 1990s, collective bargaining itself has played a role of a ‘functional equivalent’ to social pact because collective agreements included welfare issues in addition to wages (Due and Madsen 1998, 521; for quotation, Estévez-Abe 2008). After 1993, the social democratic government took the lead in reforming the welfare state, cutting down expenditures in PLMP and increasing expenditures in ALMP. For example, the social democratic government reduced the replacement rates of unemployment insurance and connected it to ALMP (Green-Pedersen 2003; Green-Pedersen et al. 2005). However, the social democratic government did not slim down social expenditures in PLMP to such an extent as the Netherlands and Ireland did (see <Figure 3>).

In the Netherlands, the social democratic union movement (NVV) and the Catholic union movement (NKV) merged into FNV in 1976. Representing both progressive and conservative lines, FNV amid turbulent labor strikes did not raise such radical issues as codetermination and wage earners' funds. As unemployment rate went up as high as 12 percent in 1979, FNV and employers’ associations made a draft including centralized wage bargaining, the reform of social policies, and employment conditions. But FNV withdrew from it at the final stage due to the opposition by several affiliated union federations. After 1982, Lubbers’ government of the Christian Democratic Party (CDA) promoted welfare retrenchments and sought to revive centralized wage bargaining. The Lubbers’ government pushed employers’ associations to accommodate the government initiative with an intimidation that otherwise, the state would intervene in industrial relations. In 1982, labor and capital stroke a social pact. Differently from the 1970s, the Labor Party (PvdA) did not oppose to the situation that CDA occupied a pivotal position in promoting welfare retrenchments and the resumption of concertative tripartism. Labor and capital also stroke social pacts in 1993 and in 2002. In contrast to Denmark, the CDA took the initiative of welfare retrenchments, so that welfare reforms leaned towards the social investment state reallocating resources from PLMP to ALMP (Visser and Hemerijck 1997, 100-01; Andeweg 1999, 132; Kitschelt 2001; Green-Pedersen and van Kersbergen 2002)

Ireland belongs to a case that the coalition government took the lead in reforming tripartite relations and implementing income policy. After the 1987 election, the Fianna Fail (Soldiers of Ireland), a traditionally dominant party, found itself in an unprecedented situation that it could no longer form a majority government without forging a coalition with the Progressive Democrats or the Labour Party. Since the 1989 election, Fianna Fail forged a coalition government either of them. In the meanwhile, the state promoted industrial policies aggressively. The state also intervened in the labor market by means of taking advantage of such intermediate institutions as the Labour Court, the Labour Relation Committee, and the Court of Employment Appellate. Under the leadership of the state, Irish labor and capital has struck social pacts successively since the year 1987: 1990, 1994, 1997, 2000, and 2003. Irish social pacts dealt with the whole gamut of issues from wage restraint, social policies to taxation (von Prondzynski 1998, 62; Teague and Donaghey 2004; O’Hearn 2000; O’Riain 2000; Katz 2004). The Irish policy regime of linking income policy and social policies is unique. As in CMEs, wage dispersion has been getting narrower although its width still remains wide. While narrowing wage dispersion through income policy, the Irish state has pursued the social

12

investment state reducing expenditures in PLMP but reinforcing ALMP-centered social policies as shown in <Figure 3>.

The South Korean Case as a Counterfactual Until the democratization of 1987, the so-called developmental state had taken the lead in coordinating the market economy. The state employed a whole gamut of policies from the income policy of controlling price and wages, industrial policy, to financial policy. However, the tripartite relations have not been formed in South Korea so far. The state excluded labor from the policy-making processes, on the one hand, and protecting and supporting conglomerates, i.e., Chaebeols, to accumulate capital and control workers and subcontractors, on the other hand (Choi 1900).

After the democratization in 1987, the first civilian government, led by President Kim Young-Sam, was established in 1993. The civilian governments did not play the same role of the developmental state (Cho 1998). Instead, the developmental state was considered as a legacy of authoritarian regime that needs to be overcome. In 1994, Kim Young-Sam’s government dissolved the Ministry of Economic Planning Board, a core ministry during the export-led development under the developmental state. This measure symbolized a break with the past (Lee et al. 2006, 206).

In response to the Asian financial crisis, on the one hand, Kim Dae-Jung’s government transformed the Korean economy into the one close to LME by implementing the policies of neoliberalism and enhancing flexibility in the labor market. On the other hand, Kim Dae-Jung’s government pursued the social investment state at the same time. It was Kim Dae-Jung’s government and the subsequent Roh Moo-Hyun’s government that the state tried to institutionalize tripartism. But their efforts turned out to be abortive because the state exploited it to transform the state-led market economy into an Anglo-American style LME.

The Korean Tripartite Commission was founded amid the financial crisis―January 1998. On Feb. 6, 1998, tripartite actors and representatives of political parties together struck a social pact covering as many as 90 issues. However, the state took advantage of social concertation in order to deregulate employment protection, thus allowing for layoff and dispatched working to which the union movements strongly opposed (Park 2000; Kim 2001). As Korean economy got over economic crisis, the Korean Tripartite Commission stopped functioning. In February 1999, the radical wing of the Korean union movements－the Democratic Labor Confederation (KCTU)－withdrew from the Korean Tripartite Commission (Choi et al. 1999; Lim et al. 2002). In a sense, the state founded and exploited the Korean Tripartite Commission to transform Korean economic system into the one in which concertative corporatism would be unnecessary (Ahn 2008). The impact of deregulation policy was substantial. The proportion of non-regular workers grew fast, exceeding 50 percent of the total labor force in 1999 and recording 56.5 percent in 2002. As of now, the proportion has not yet dropped less than 50 per cent (Kim and Seong 2005, 48-82; Kim 2011).

Kim Dae-Jung’s and Roh Mu-Hyun’s governments made efforts to institutionalize welfare capitalism. Kim Dae-Jung’s government revamped and integrated the divided and decentralized management structures of pension and health insurances. It also extended the beneficiaries of employment insurance and industrial accident insurance to all the employees. National basic security act was enacted in 1999. Roh Mu-Hyun’s government reinforced the system of social services. However, the two governments

13

pursued the social investment state, emulating Blair’s government. That is, the two governments reinforced social securities in order to take care of the large number of the unemployed the deregulation of the labor market produced and to assist them to return to market (Kim 2002; Kim 2009). Immediately after the 1997 financial crisis, Kim Dae-Jung’s government expanded public expenditures in ALMP without corresponding increases in social expenditures in PLMP. For example, in 2002, expenditures on ALMP occupied 0.22 percent of GDP whereas the share of public expenditures on PLMP remained as low as 0.16 percent (OECD 2006). The subsequent Roh Moo-Hyun’s government set the strategy of the social investment state in more concrete by promulgating Vision 2030 in 2006 (Ministry of Planning and Budget 2006).

Korean governments’ strategies of social investment state brought about results similar to those the liberal welfare states experienced after globalization. Deregulation of the labor market contributed to reducing the rates of unemployment after 1997. But the reduction of unemployment was due to substantial increases in non-regular workers. What was worse, the state pursued the social investment state without combining it with income policy. Regular workers’ jobs and incomes were firmly protected by strong union movements whereas non-regular workers’ were not. Consequently, wage gaps got wider and wider, and social inequalities got worse (<Figure 5> and <Figure 6>). In a sense, two types of political economy regime have been entrenched on the level of industries. Major firms－most of which belong to conglomerates－may not necessarily have conflicting interests against the union movements’. This is because major firms have interests in providing regular workers with job protection and welfares in order to secure skilled worker. But major firms seek to make up for the costs of company welfare programs by employing low-wage non-regular workers. Most of non-regular workers are not protected by social insecurities. For union movements, the enhancement of non-regular workers’ interests is not that imperative relative to that of union members' (Yang 2005; Shin 2006).

CONCLUSION

In this paper, we sought to identify the implementation of wage restraining income policy as the necessary condition of employment growth. Since globalization, welfare capitalist countries have suffered from jobless growth and ever-aggravating social inequalities. Growth and welfare attract scholarly interests, again. But their prescriptions are diverse. For example, SIT scholars propose a combination of the deregulation of labor market and ALMP-centered social policies whereas VOC argues that supply-side economy should be complemented by PLMP-centered social policies. However, neither approach analyzes the interaction of income policy with social policies. We also hypothesized that social investment policies should be combined with PLMP-centered social policies to avoid the deepening of social inequalities.

To show this, we selected most similar cases based on Esping-Anderson’s typology of welfare capitalism. Then, we select pairs of cases from the most similar cases that are different each other employing our typology. Using Mill’s method of disagreement and Boolean algebra, we showed that the implementation of wage restraining income policy is the necessary condition of low unemployment. High employment occurs due to the interaction effects between the failure of wage restraining income policy and the implementation of PLMP-centered social policies.

14

In comparative case study, we analyzed how policy regimes provoked the politics of conflicts, thereby undergoing transformation cross-temporally. Three factors affected the paths of the welfare capitalism. First, policy regime mattered. In case that income policy was linked to ALMP, as was in Sweden, unemployment remained low even after entering into the era of globalization. In the meanwhile, tripartite actors were plunged into ever-aggravating conflicts. In case income policy was linked to PLMP, as were in Denmark and the Netherlands, high employment swooped on the labor market in the 1970s. As long as the wage restraining income policy was successfully implemented, high unemployment did not occur. Austria has kept unemployment low without suffering from severe conflicts of tripartite relations. The state in Austria relied mainly on the social policy of transfer payments in order to compensate for low wages.

Second, the historical timing of globalization reversed the fortunes of welfare capitalism. As the Swedish case showed, if entering into the era of globalization amid the on-going conflicts of tripartite relations, it is not easy to resume the tripartite concertation. If tripartite actors promoted concertation before their economies were engulfed by the force of globalization, they tend to be successful in resuming tripartite concertation thereafter. Denmark and the Netherlands belonged to this case.

Finally, politics mattered. In the era of globalization, the locus of tripartite concertation was shifted from the corporatist networks of interest intermediation to the public sphere of social concertation. This shift took place mainly in those countries where the organizational conditions of corporatism had not been satisfied. This new politics of tripartism implies that politics of consensus all the more matters in the era of globalization. Then, we must also answer to the question why the same countries of consensus model had suffered from the decline of corporatism and thus from the malfunctioning of coordinated market economy in the 1970s and the 1980s. How have the political spheres in these countries reformed themselves to successfully manage to coordinate conflicts in the economic sphere? This is another question left for future research.

15

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19

<Table 1> Typology of the Regimes of Social Policy and Income Policy

Types of Income Policy

Types of Social Policy CME/Solidaristic Wage

Coordination

CME/Wage Restraining Coordiantion

LME

ALMP(high)/PLMP(Middle) I II (III)

ALMP(Middle)/PLMP(Middle) IV V (VI)

ALMP(Middle)/PLMP(Low) VII VIII IX

ALMP(Low)/PLMP(High) X XI (XII)

ALMP(Low)/PLMP(Low) (XIII) (XIV) XV Note: Considering the characteristics of production regimes and social policies, the cases in parenthesis

are the ones unlikely to exist.

<Table 2> Effects of Policy Combination

Policy Regimes Effects Case

XV ---------> IX · Increase in employment · Aggravation of social inequalities

UK

XV --------> VIII · Increase in employment · Minor reduction of social

inequalities Ireland

XI --------> V · Increase in employment · Aggravation of social inequalities

The Netherlands

X ---------> IV · Increase in employment · No improvement in social

inequalities Denmark

I · Low unemployment · Low level of social inequalities

Sweden

XI · Low unemployment · Low level of social inequalities

Austria

20

<Figure 1> Wage Dispersion and Unemployment in OECD Countries before

globalization (1980)

OECD, Directorate for Employment, Labour and Social Affairs (OECD: Paris).

http://www.oecd.org/document/34/0,3343,en_2649_33927_40917154_1_1_1_1,00.html 주1) Pierson's correlation = .593; Significance level = .012 (two-tail test)

<Figure 2> Wage Dispersion and Unemployment in OECD Countries after Globalization (2000)

Source: OECD, Directorate for Employment, Labour and Social Affairs (OECD:Paris). Note 1) In case excluding Sweden,

Norway, Denmark, and Switzerland, Pierson's correlation = -.440; Significance level = .132.

21

<Table 3> Esping-Andersen’s Typology of Welfare Capitalism

Decommodification Social

Stratification High Low

Strong Conservative Welfare State (The Netherlands, Austria)

Weak Social Democratic Welfare

State (Sweden, Denmark)

Liberal Welfare State (Ireland)

<Figure 3> Expenditures in Social Polices and Dispersion of Wages (1980 and 2000)

Source: OECD, OECD Social Expenditure Database. http://www.oecd.org/document/9/0,3746,en_2649_33933_38141385_1_1_1_1,00.html

AUL

AUT(1980)

CAN DEN (1980)

FIN

FRA

FRG

IRE(1994)

ITA

JPN

NED (1980)

NZ

NOR

SWE (1980)

SWZ

UK(1980)

USA

AUT (2004)

DEN (2000)

IRE(2000)

NED(2000)

SWE (2000)

UK(2000)

0

0.5

1

1.5

2

2.5

3

3.5

1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 2.0 2.1 2.2 2.3 2.4

III

II

IV

I

AL

MP

/ PL

MP

P50 / P10

22

<Table 4> A Typology of Policy Regime

Wage Dispersion ALMP-PLMP Combination Low Middle/High

Balanced Sweden (after GB), Denmark (after GB)

ALMP-centered Sweden (before GB) The Netherlands (after

GB), Ireland (after GB)

PLMP-centered Denmark (before GB)

The Netherlands (before GB)

Austria (before and after GB)

Note: GB is globalization

<Figure 4> Fluctuations of Unemployment Rates

Source: OECD, Directorate for Employment, Labour and Social Affairs (OECD:Paris). http://www.oecd.org/document/34/0,3343,en_2649_33927_40917154_1_1_1_1,00.html

* Danish employment (1968-1981) and Austrian employment (1968-1981, 1984) are not standardized ones. See, OECD (1983), Historical Statistics 1960-1981 (Paris: OECD, 1983)

0

2

4

6

8

10

12

14

16

18

1962

19

64

1966

19

68

1970

19

72

1974

19

76

1978

19

80

1982

19

84

1986

19

88

1990

19

92

1994

19

96

1998

20

00

2002

20

04

2006

20

08

2010

Austria Denmark Ireland Netherlands Sweden

Une

mpl

oym

ent

23

<Table 5> Examples of Difference

Types Cases Circumstance of Difference

The Social

Democratic State

Sweden-

Denmark

· Before GB: Social policy (ALMP-centered vs.

PLMP-centered) · Before GB: Income policy (Success vs. Break-down)

The Conservative Welfare State

The Netherlands-

Austria

· Before GB: Income policy (Breakdown vs.

Success) · After GB: Social Policy (ALMP-centered vs. PLMP-centered)

The Liberal Welfare State

The UK-Ireland

· After GB: Income Policy (LME vs. Wage Coordination)

<Table 6> Truth Table on Causes of Unemployment

A P I U

Sweden 1st Period, Sweden 2nd Period, Ireland 3rd Period, The Netherlands 3rd Period

1 0 1 1

Denmark 1st Period, The Netherlands 1st Period, Austria 1st Period, Austria 2nd Period, Austria 3rd Period

0 1 1 1

Denmark 3rd Period 1 1 1 1

Sweden 3rd Period 1 1 0 0

Denmark 2nd Period, The Netherlands 2nd Period 0 1 0 0

Note: 1. 1st period is the period between World War II and the first oil-shock of 1973; 2nd period is the period between the first-oil shock and the beginning of globalization; 3rd period is the period after the beginning of globalization. 2. References: Kenworthy 2001; Layard et al. 2005; Flanagan et al. 1983, chapters. See also section on comparative study

24

<Table 7> Unemployment and Labor Participation

Unemployment (%)1) Labor Participation (%)

Mid-1980s

Mid-1990s Mid-2000s Mid-

1980s Mid-

1990s Mid-

2000s

Sweden 2.93 9.31 6.96 80.12 71.12 74.38

Denmark 6.58 7.12 4.69 73.76 73.62 76.16

Netherlands 7.30 6.13 4.49 52.12 65.34 72.86

Austria - 4.09 4.71 - - 69.38

England 10.90 8.54 5.03 66.88 69.28 72.54

Ireland 15.93 12.76 4.49 50.36 53.64 66.92

Note 1) Danish employment (1968-1981) and Austrian employment (1968-1981, 1984) are not standardized. See, OECD (1983), Historical Statistics 1960-1981 (Paris: OECD, 1983) Source: OECD, Directorate for Employment, Labour and Social Affairs (OECD: Paris).

<Table 8> Gini-Index

Mid-1970s

Mid- 1980s 1990 Mid-

1990s 2000 Mid-2000s

Sweden 0.212 0.198 0.209 0.211 0.243 0.234

Denmark 0.221 0.226 0.215 0.226 0.232

Netherlands 0.263 0.272 0.292 0.297 0.292 0.284

Austria 0.236 0.238 0.252 0.265

UK 0.268 0.309 0.354 0.336 0.353 0.331

Ireland 0.331 0.324 0.304 0.314

Source: OECD, Directorate for Employment, Labour and Social Affairs (OECD: Paris).

25

<Figure 5> Unemployment and Wage Dispersion, 1991-2011

Data Source: Korean Statistical Information Service http://kosis.kr/. For unemployment 1991-1999, National Statistical Office, International Statistics Yearbook (Korean), each year.

<Figure 6> Unemployment and Social Inequalities, 1991-2011

Data Source: Korean Statistical Information Service http://kosis.kr/. For unemployment 1991-1999, National Statistical Office, International Statistics Yearbook (Korean), each year.

1

1.5

2

2.5

3

0

1

2

3

4

5

6

7

8 19

9 0 199 1 199 2 199 3 199 4 199 5 199 6 199 7 199 8 199 9 200 0 200 1 200 2 200 3 200 4 200 5 200 6 200 7 200 8 200 9 201 0 201 1

Une

mpl

oym

ent (

%)

P50/

P10

(Mar

klet

Inco

me)

0.2

0.25

0.3

0.35

0.4

0

1

2

3

4

5

6

7

8

1990

19

91

1992

19

93

1994

19

95

1996

19

97

1998

19

99

2000

20

01

2002

20

03

2004

20

05

2006

20

07

2008

20

09

2010

20

11

Unem

ployment (%

)

Gini Index (M

arket Income)