Publications by Author: Iversen%2C%20Torben

2019
Democracy and Prosperity: Reinventing Capitalism through a Turbulent Century
It is a widespread view that democracy and the advanced nation-state are in crisis, weakened by globalization and undermined by global capitalism, in turn explaining rising inequality and mounting populism. This book, written by two of the world’s leading political economists, argues this view is wrong: advanced democracies are resilient, and their enduring historical relationship with capitalism has been mutually beneficial.

For all the chaos and upheaval over the past century—major wars, economic crises, massive social change, and technological revolutions—Torben Iversen and David Soskice show how democratic states continuously reinvent their economies through massive public investment in research and education, by imposing competitive product markets and cooperation in the workplace, and by securing macroeconomic discipline as the preconditions for innovation and the promotion of the advanced sectors of the economy. Critically, this investment has generated vast numbers of well-paying jobs for the middle classes and their children, focusing the aims of aspirational families, and in turn providing electoral support for parties. Gains at the top have also been shared with the middle (though not the bottom) through a large welfare state.

Contrary to the prevailing wisdom on globalization, advanced capitalism is neither footloose nor unconstrained: it thrives under democracy precisely because it cannot subvert it. Populism, inequality, and poverty are indeed great scourges of our time, but these are failures of democracy and must be solved by democracy.
2008

The authors propose a synthesis of power resources theory and welfare production regime theory to explain differences in human capital formation across advanced democracies. Emphasizing the mutually reinforcing relationships between social insurance, skill formation, and spending on public education, they distinguish three distinct worlds of human capital formation: one characterized by redistribution and heavy investment in public education and industry-specific and occupation-specific vocational skills; one characterized by high social insurance and vocational training in firm-specific and industry-specific skills but less spending on public education; and one characterized by heavy private investment in general skills but modest spending on public education and redistribution. They trace the three worlds to historical differences in the organization of capitalism, electoral institutions, and partisan politics, emphasizing the distinct character of political coalition formation underpinning each of the three models. They also discuss the implications for inequality and labor market stratification across time and space.

iversen_partisan.pdf

Low levels of female labor force participation contribute to female underrepresentation in democratic polities, both by reinforcing traditional voter attitudes toward women (a demand-side feature) and by constraining the supply of women with professional experience and resources who are capable of mounting credible electoral campaigns. Female labor force participation, however, is only part of the story. Comparative analysis suggests that electoral systems have a strong, systematic effect on the extent to which women’s workforce participation boosts female political representation. In candidatecentered political systems, where seniority is an important factor in legislative effectiveness, career interruptions for the sake of childcare and other family work hurts female aspiring politicians more seriously than in proportional representation (PR) systems, where political parties control the policy platform and constituency service is a minor consideration in the careers of candidates. In countries with mixed electoral systems, women do better in seats elected by PR than by single-member plurality. Within countries, women are more likely to get elected to offices characterized by shorter tenure and higher average levels of turnover.

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2007

Why do advanced democracies cluster into some that are highly inegalitarian and redistribute very little and others that are highly egalitarian and redistribute a great deal? Related, why do some economies rely a great deal on free market exchange while others are permeated by a dense network of non-market regulations and organizations? As Korpi reminds us in a recent World Politics article (Korpi 2006), explaining this diversity, and its persistence, is a main task for anyone interested in understanding the workings of modern capitalism.

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A previous version of this paper was presented at the 2006 Annual Meetings of the American Political Science Association, August 31-September 3, in Philadelphia.
 

Iversen, Torben, Thomas R. Cusack, and David Soskice. 2007. “Economic Interests and the Origins of Political Systems”. Abstract

The standard explanation for the choice of electoral institutions, building on Rokkan’s seminal work, is that proportional representation (PR) was adopted by a divided right to defend its class interests against a rising left. But new evidence shows that PR strengthens the left and redistribution, and we argue the standard view is wrong historically, analytically, and empirically. We offer a radically different explanation. Integrating two opposed interpretations of PR—minimum winning coalitions versus consensus—we propose that the right adopted PR when their support for consensual regulatory frameworks, especially those of labor markets and skill formation where co-specific investments were important, outweighed their opposition to the redistributive consequences; this occurred in countries with previously densely organized local economies. In countries with adversarial industrial relations, and weak coordination of business and unions, keeping majoritarian institutions helped contain the left. This explains the close association between current varieties of capitalism and electoral institutions, and why they persist over time.

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2005
Iversen, Torben, David Soskice, and Samuel Abrams. 2005. “Interests, Parties, and Social Embeddedness: Why Rational People Vote”. Abstract

After five decades of research the answers to two questions that are critical to our understanding of democracy are still incomplete. The first is why some people acquire costly information about politics when we would expect them to be “rationally ignorant.” The second is why people vote when we would expect them to “rationally abstain.” Both were originally identified by Downs (1957) and spring from the fact that individuals are rarely able to affect the outcome of an election.

Informed and participating citizens are the bread and butter of democratic politics, and they are critical for many of our models of politics. People who are reasonably well informed about their own interests are necessary for stable political competition, and nearly all political economy models assumes a link between economic interests and political behavior. Why people tend to be better informed and participate more frequently than simple rational choice models would allow therefore continues to be of great practical and theoretical importance.

Prepared for presentation at the 2005 Comparative Political Economy Workshop at the Center For European Studies, Harvard University.
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Most studies of gender socialization start with patriarchy and explore its effects on female social, economic, and political status. In this paper we turn the causal arrow the other way to understand where patriarchal values come from in the first place. We argue that the relationship between the mobility of male economic assets to the mobility of female economic assets goes far in explaining intra-family bargaining power, and by extension, in explaining the norms that become societally dominant. We investigate this proposition empirically by looking at mate choice preferences between agricultural, industrial, and post-industrial societies, and by looking at the gender gap in political attitudes.

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2001

Most explanations of female under-representation in democratic polities emphasize either demand for female representatives (say, as a function of female labor force participation), the political mobilization of women, or overt or covert discrimination by male-dominated political organizations. We offer a different—though not necessarily competing—explanation based on an analysis of democratic politics as a particular type of career market. Because seniority is an important factor in legislative effectiveness in candidatecentered systems, career interruptions for the sake of childcare and other family work hurts female aspiring politicians more seriously in majoritarian systems than in PR systems where political parties control the policy platform and constituency service is a minor consideration in the careers of candidates. We find support for this explanation from several sources. First, we find that personalistic electoral systems penalize females (following the rank ordering technique provided by Carey and Shugart 1995). Second, we find that in countries with mixed electoral systems women do better in seats elected by PR than by SMP.

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Social protection does not always mean "politics against markets." In this chapter we argue, as did Polanyi (1994), that social protection rescues the market from itself by preventing market failures. More specifically, we contend that social protection aids the market by helping economic actors overcome market failures in skill formation. We show, in this chapter, that different types of social protection are complementary to different skill equilibria.

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2000

Our argument, in short, is that most of the risks being generated in modern industrialized societies are the product of technologically induced structural transformations inside na–tional labor markets. Increasing productivity, changing consumption patterns, and saturated demand for products from the traditional sectors of the economy are the main forces of change. It is these structural sources of risk that fuel demands for state compensation and risk sharing.

Monetary rules matter for the equilibrium rate of employment when the number of price–wage setters is small. If the central bank is non–accommodating, sufficiently large unions, bargaining independently, have an incentive to moderate sectoral money wages, and thereby expected real wages. The result is an increase in the real money supply, and hence higher demand and employment. This does not hold, however, with accommodating monetary policy since unions? wage decisions cannot then affect the real money supply. A similar argument holds for large monopolistically–competitive price setters. Rational expectations, complete information, central bank pre–commitment and absence of nominal rigidities are assumed.