Introducing Institutions: the Concept of Institutional Embeddedness

Abstract

In the preceding Part II, we have analysed dimensions of inequality in the employment as captured by the concept of occupational class. In doing so, our exclusive focus has been on stratification resulting from the market. However, an individual’s life chances do not solely derive from his or her labour market position. Besides the household, institutions such as the welfare state or trade unions significantly modify the outcomes of market relations in Western Europe. Thus, it has been widely argued that welfare provisions have stratifying effects. Some policies may promote equality and minimize economic differences, while others may uphold social dualism and strengthen occupational differentiation. In this context, Orloff (1993: 305) maintains that ‘the programs of the modern welfare state differentially advantage various social groups, and there is important variation … in the extent to which the interests of dominant and subordinate groups are enhanced’. In other words, class divisions produced by the market may be lessened or reinforced by the institutional setting (e.g. Esping-Andersen and Korpi, 1984; Esping-Andersen, 1990). Hence, it is reasonable to expect that the degree to which an individual benefits from social provisions or collective bargaining influences on his or her life chances. And as our aim is to obtain an accurate picture of social stratification, politics and the role of institutions cannot be left aside.