IDEAS home Printed from https://ideas.repec.org/a/bla/ecopol/v37y2025i1p271-303.html

What causes polarized stagnation, corporate economy, or welfare state?: Insights from new development economics

Author

Listed:
  • Sung‐Hee Jwa

Abstract

This study explores polarized economic stagnation from the perspective of a capitalist corporate economy. It introduces two institutional policy paradigms: economic differentiation (ED) and economic egalitarianism (EE). ED‐friendly “market democracy” promotes shared growth, whereas EE‐friendly “egalitarian democracy” leads to polarized stagnation. The corporate economy is portrayed as the epitome of the ED institution leading shared growth, whereas the redistributive welfare state based on EE institutions could bring polarized stagnation. Empirical analysis tests these hypotheses and discovers that the world's polarized stagnation may be linked to “welfare policy under egalitarian democracy” rather than “corporate growth under market democracy” as commonly thought.

Suggested Citation

  • Sung‐Hee Jwa, 2025. "What causes polarized stagnation, corporate economy, or welfare state?: Insights from new development economics," Economics and Politics, Wiley Blackwell, vol. 37(1), pages 271-303, March.
    • Handle: RePEc:bla:ecopol:v:37:y:2025:i:1:p:271-303
    DOI: 10.1111/ecpo.12316
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/ecpo.12316
    Download Restriction: no
    File URL: https://libkey.io/10.1111/ecpo.12316?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Harcourt,G. C. With contributions by-Name:Cohen,Avi J. With contributions by-Name:Mata,Tiago, 2022. "Some Cambridge Controversies in the Theory of Capital," Cambridge Books, Cambridge University Press, number 9781009158152, August.
    2. Sung-Hee Jwa, 2018. "Achieving the Shared Economic Growth," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 57(1), pages 45-71.
    3. Oliver E. Williamson, 2010. "Transaction Cost Economics: The Natural Progression," American Economic Review, American Economic Association, vol. 100(3), pages 673-690, June.
    4. Mulligan, Casey B., 2012. "The Redistribution Recession: How Labor Market Distortions Contracted the Economy," OUP Catalogue, Oxford University Press, number 9780199942213.
    5. Joseph Nathan Cohen & Miguel Angel Centeno, 2006. "Neoliberalism and Patterns of Economic Performance, 1980-2000," The ANNALS of the American Academy of Political and Social Science, , vol. 606(1), pages 32-67, July.
    6. Gregory Clark, 2007. "Introduction to A Farewell to Alms: A Brief Economic History of the World," Introductory Chapters, in: A Farewell to Alms: A Brief Economic History of the World, Princeton University Press.
    7. Cohen, Joseph N. & Centeno, Miguel A., 2006. "Neoliberalism and patterns of economic performance: 1980 to 2000," MPRA Paper 22436, University Library of Munich, Germany.
    8. Eggertsson,Thrainn, 1990. "Economic Behavior and Institutions," Cambridge Books, Cambridge University Press, number 9780521348911.
    9. Frederick Solt, 2016. "The Standardized World Income Inequality Database," Social Science Quarterly, Southwestern Social Science Association, vol. 97(5), pages 1267-1281, November.
    10. Card, David & Krueger, Alan B, 1994. "Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania," American Economic Review, American Economic Association, vol. 84(4), pages 772-793, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sung-Hee Jwa, 2024. "Koreas Saemaul Undong Revisited as Rural Development Game for Poverty Eradication: A New Development Economics Perspective (Article)," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 63(1), pages 19-44.
    2. Cosmin MARINESCU, 2012. "Transaction Costs and Economic Performance: An Institutional Approach," Economia. Seria Management, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 15(2), pages 371-379, December.
    3. Fabio Ascione & Maria Enrica Virgillito, 2023. "Vertical integration and patterns of divergence in European industries: A long-term input-output analysis," LEM Papers Series 2023/25, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    4. Golovics, József, 2021. "Intézmények, tökéletlen racionalitás és tranzakciós költség. Egységes terminológia az új intézményi Nobel-díjasok körében? [Institutions, imperfect rationality and transaction cost. A unified terminology among new institutionalist Nobel laureates?," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(1), pages 32-46.
    5. Mundaca, Luis & Mansoz, Mathilde & Neij, Lena & Timilsina, Govinda R, 2013. "Transaction costs of low-carbon technologies and policies : the diverging literature," Policy Research Working Paper Series 6565, The World Bank.
    6. Vimal Ranchhod & Arden Finn, 2016. "Estimating the Short Run Effects of South Africa's Employment Tax Incentive on Youth Employment Probabilities using A Difference-in-Differences Approach," South African Journal of Economics, Economic Society of South Africa, vol. 84(2), pages 199-216, June.
    7. Mwangi, Esther, 2006. "Subdividing the Commons: The Politics of Property Rights Transformation in Kenya’s Maasailand," CAPRi Working Papers 42510, CGIAR, International Food Policy Research Institute (IFPRI).
    8. Dickens, Richard & Machin, Stephen & Manning, Alan, 1998. "Estimating the effect of minimum wages on employment from the distribution of wages: A critical view," Labour Economics, Elsevier, vol. 5(2), pages 109-134, June.
    9. Kawalec Paweł, 2020. "The dynamics of theories of economic growth: An impact of Unified Growth Theory," Economics and Business Review, Sciendo, vol. 6(2), pages 19-44, June.
    10. Koichi Fukumura & Atsushi Yamagishi, 2020. "Minimum wage competition," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 27(6), pages 1557-1581, December.
    11. Do, Manh Hung & Nguyen, Trung Thanh & Grote, Ulrike, 2023. "Land consolidation, rice production, and agricultural transformation: Evidence from household panel data for Vietnam," Economic Analysis and Policy, Elsevier, vol. 77(C), pages 157-173.
    12. Wang, Hui & Riedinger, Jeffrey & Jin, Songqing, 2015. "Land documents, tenure security and land rental development: Panel evidence from China," China Economic Review, Elsevier, vol. 36(C), pages 220-235.
    13. Luis Aguiar & Jörg Claussen & Christian Peukert, 2018. "Catch Me If You Can: Effectiveness and Consequences of Online Copyright Enforcement," Information Systems Research, INFORMS, vol. 29(3), pages 656-678, September.
    14. Zsófia L. Bárány, 2016. "The Minimum Wage and Inequality: The Effects of Education and Technology," Journal of Labor Economics, University of Chicago Press, vol. 34(1), pages 237-274.
    15. Qingqian He & Qing Meng & William Flatley & Yaqian He, 2022. "Examining the Effects of Agricultural Aid on Forests in Sub-Saharan Africa: A Causal Analysis Based on Remotely Sensed Data of Sierra Leone," Land, MDPI, vol. 11(5), pages 1-20, April.
    16. David Card, 2022. "Design-Based Research in Empirical Microeconomics," American Economic Review, American Economic Association, vol. 112(6), pages 1773-1781, June.
    17. Clark, Gregory & Cummins, Neil, 2016. "The Child Quality-Quantity Tradeoff, England, 1780-1880: A Fundamental Component of the Economic Theory of Growth is Missing," CEPR Discussion Papers 11232, Centre for Economic Policy Research.
    18. Pearce Edwards & Patrick Pierson, 2023. "Incumbent-Aligned Terrorism and Voting Behavior: Evidence from Argentina’s 1973 Elections," Journal of Conflict Resolution, Peace Science Society (International), vol. 67(4), pages 672-700, April.
    19. Peter Harasztosi & Attila Lindner, 2019. "Who Pays for the Minimum Wage?," American Economic Review, American Economic Association, vol. 109(8), pages 2693-2727, August.
    20. Mustapha Douch & Terence Huw Edwards, 2022. "The bilateral trade effects of announcement shocks: Brexit as a natural field experiment," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 37(2), pages 305-329, March.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:ecopol:v:37:y:2025:i:1:p:271-303. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0954-1985 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.