Theories of Inequality

1. Theories of Inequality • Marxist Social Conflict Perspective • View of Society • Causes of Inequality • Plan for Action • Problems with Marx • Useful Insights from Marx • Weber’s Social Conflict Perspective • View of Society • Multidimensional View of Inequality • Outlook on the Future • Structural Functional Perspective (Davis & Moore) • View of Society • Explanation of Inequality • Problems with Davis and Moore’s Perspective • Useful Insights from Davis and Moore

2. Karl Marx 1818-1883

3. View of Society • Economic context • Political context • Modes of production • Means of production • Relations of production • Key assumptions for Marx

4. Causes of Inequality and theLabor Theory of Value • Selfishness of capitalists under capitalism • Leads to exploitation of the worker • Leads to sharp divisions between classes • Leads to feelings of alienation and frustration by workers.

5. Plan for Action:Becoming Class Conscious • Concentration and Communication • Deprivation • Economic Insecurity • Alienation at Work • Polarization • Homogenization • Organization and Struggle

6. Problems with Marx • Revolution did not occur • Capitalism was more prosperous for the worker class than Marx predicted • Profits don’t necessarily come solely from labor • Marx did not account for other divisions in society besides class • Marx does not account for authority

7. Useful Insights from Marx • Marx was right that once in large factories workers would organize

8. Useful Insights from Marx • There is a growing gap between upper and lower classes, e.g. CEO salary compared to worker salary: • 1973 45 x’s • 1991 141 x’s • 2002 500 x’s

9. In 1996, Business Week published the findings of an income survey of the top two executives at 362 of the nation's largest companies. Current CEO compensation and the bailout.

10. Useful Insights from Marx • Class conflict does exist • Trends in the deskilling of American workers

11. Useful Insights from Marx • Capitalism has generated greater concentrations of wealth owned by fewer people • 1950--top 100 of top 200,000 corps. controlled 40% of industrial assets • 1986--top 100 controlled 61%

12. Source: Wolff, Edward N. 2007. “Recent Trends in Household Wealth in the United States: Rising Debt and the Middle-Class Squeeze.” p. 15 (http://www.levy.org/pubs/wp_502.pdf).

13. Max Weber1864-1920

14. Weber’s Approach to Inequality • Weber’s view of society. • Weber’s multidimensional view of inequality. • Weber’s outlook on the future.

15. Weber’s View of Society • Society is located in ideas • Religion as source of ideas leading to capitalism • The Protestant Ethic • The Spirit of Capitalism

16. The Emergence of Capitalism Protestant Ethic • Protestant Reformation—Luther’s idea of a “calling” • Notion that God expected people to master the world and master nature • Doctrine of predestination (Calvin)

17. The Emergence of Capitalism • Protestant ethic established a rational approach to the unlimited pursuit of profit = capitalism

18. Weber’s Multidimensional View of Inequality • Class • Status • Power/Party

19. Weber’s view of the future • Inequality is inevitable • Iron Cage of Bureaucracy

20. Structural Functionalist Approach to Inequality (Davis and Moore) • View of Society • Explanation of Inequality • Flaws and Useful Insights Kingsley Davis (1908-1997) Wilbert E. Moore (1914-1987)

21. View of Society • Basic ideas of functionalism--society is like an organism with interdependent parts • Davis & Moore--society is a hierarchy of positions • Key assumptions

22. Explanation of Inequality • Inequality is necessary • Motivate best people to take appropriate positions • Insure people perform once in those positions • How are positions ranked? • Functional importance • Scarcity of skill

23. Explanation of Inequality • How are people matched to positions? • Differential rewards are attached to more important positions (i.e. those that require greater skill or training) • Economic • Prestige • Ascetic

24. Flaws of Davis & Moore’s Theory • Leads to blaming the victim. • Equality of opportunity is implied • Training is not always costly • Over-emphasizes the value of economic rewards • Most important jobs are not always highly rewarded (and vice versa) • Who gets to decide which jobs are the most functionally important?

25. Useful Insights • Understanding of the importance of occupation to the placement of individuals in society • Taps into our notion of how things should work--meritocracy

26. Marx Class Consciousness Inequality Conflict Change Communism Weber Inequality Rationality Conflict Change Rationality

27. Three Perspectives on How Society is Divided Capitalist (Bourgeoisie) Hierarchy of Positions Status Class Party Worker (Proletariat) Marx Weber Davis and Moore