Politische Grundlagen und Folgen von Dualisierungsprozessen: Eine politische Ökonomie der Hartz-Reformen

This article contributes to the debate about the causes and consequences of institutional dualization that characterises recent labour market reforms in European countries. The “Hartz”-reforms in Germany helped to improve job flexibility but the costs of these policies were not distributed equally among labour-market participants. We argue that the changes in labour-market policies are part of a broader process of dualization that is due to changes in income distribution and a political reorientation of social democratic parties. Our findings suggest that labour-market reforms such as the implementation of the “Hartz”-packages were possible because of a growing income inequality that worsened the status of those with low incomes but did not erode the status of middle-income groups. Also an ideological shift of social democratic parties toward the middle-income groups, which are decisive in elections, can be observed. In a third step, we take a look at the consequences of this reorientation by analysing the political behaviour of insiders and outsiders before and after the reforms.