IDEAS home Printed from https://ideas.repec.org/a/sae/envira/v53y2021i3p548-572.html
   My bibliography  Save this article

Class in the 21st century: Asset inflation and the new logic of inequality

Author

Listed:
  • Lisa Adkins

    (School of Social and Political Sciences, Faculty of Arts and Social Sciences, 4334The University of Sydney, NSW, Australia)

  • Melinda Cooper

    (School of Social and Political Sciences, Faculty of Arts and Social Sciences, 4334The University of Sydney, NSW, Australia)

  • Martijn Konings

    (School of Social and Political Sciences, Faculty of Arts and Social Sciences, 4334The University of Sydney, NSW, Australia)

Abstract

What becomes of class when residential property prices in major cities around the world accrue more income in a year than the average wage worker? This paper investigates the dynamic of combined wage disinflation and asset price inflation as a key to understanding the growth of inequality in recent decades. Taking the city of Sydney, Australia, as exemplary of a dynamic that has unfolded across the Anglo-American economies, it explains how residential property was constructed as a financial asset and how government policies helped to generate the phenomenal house price inflation and unequal capital gains of recent years. Proceeding in close conversation with Thomas Piketty's work on inequality and recent sociological contributions to the question of class, we argue that employment and wage-based taxonomies of class are no longer adequate for understanding a process of stratification in which capital gains, capital income and intergenerational transfers are preeminent. We conclude the paper by outlining a new asset-based class taxonomy which we intend to specify further in subsequent work.

Suggested Citation

  • Lisa Adkins & Melinda Cooper & Martijn Konings, 2021. "Class in the 21st century: Asset inflation and the new logic of inequality," Environment and Planning A, , vol. 53(3), pages 548-572, May.
    • Handle: RePEc:sae:envira:v:53:y:2021:i:3:p:548-572
    DOI: 10.1177/0308518X19873673
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/0308518X19873673
    Download Restriction: no
    File URL: https://libkey.io/10.1177/0308518X19873673?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. Gianni La Cava & Hannah Leal & Andrew Zurawski, 2017. "Housing Accessibility for First Home Buyers," RBA Bulletin (Print copy discontinued), Reserve Bank of Australia, pages 19-28, December.
    2. Lowe, Philip, 2017. "Household debt, housing prices and resilience," Economic Analysis and Policy, Elsevier, vol. 55(C), pages 124-131.
    3. Özlem Onaran & Engelbert Stockhammer & Lucas Grafl, 2011. "Financialisation, income distribution and aggregate demand in the USA," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 35(4), pages 637-661.
    4. Anthony B. Atkinson & Andrew Leigh, 2007. "The Distribution of Top Incomes in Australia," The Economic Record, The Economic Society of Australia, vol. 83(262), pages 247-261, September.
    5. Jacob Robbins, 2019. "Capital Gains and the Distribution of Income in the United States," 2019 Meeting Papers 202, Society for Economic Dynamics.
    6. Raquel Rolnik, 2013. "Late Neoliberalism: The Financialization of Homeownership and Housing Rights," International Journal of Urban and Regional Research, Wiley Blackwell, vol. 37(3), pages 1058-1066, May.
    7. Chris Pierson & Francis G. Castles, 2002. "Australian Antecedents of the Third Way," Political Studies, Political Studies Association, vol. 50(4), pages 683-702, September.
    8. Goodhart, Charles, 2001. "What Weight Should Be Given to Asset Prices in the Measurement of Inflation?," Economic Journal, Royal Economic Society, vol. 111(472), pages 335-356, June.
    9. Dungey, Mardi & Wright, Danika & Yanotti, Maria, 2018. "Who, What, Where? Residential Property Investment in Australia," Working Papers 2018-01, University of Tasmania, Tasmanian School of Business and Economics.
    10. Scott Brenton, 2016. "The Politics of Budgetary Surplus," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-137-58597-4, March.
    11. Judith Yates, 2011. "Housing in Australia in the 2000s: On the Agenda Too Late?," RBA Annual Conference Volume (Discontinued), in: Hugo Gerard & Jonathan Kearns (ed.),The Australian Economy in the 2000s, Reserve Bank of Australia.
    12. Marion Kohler & Michelle Van Der Merwe, 2015. "Long-run Trends in Housing Price Growth," RBA Bulletin (Print copy discontinued), Reserve Bank of Australia, pages 21-30, September.
    13. Pamela Katic & Andrew Leigh, 2016. "Top Wealth Shares in Australia 1915–2012," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 62(2), pages 209-222, June.
    14. Jocelyn Pixley & Sam Whimster & Shaun Wilson, 2013. "Central bank independence: A social economic and democratic critique," The Economic and Labour Relations Review, , vol. 24(1), pages 32-50, March.
    15. Dunleavy, Patrick, 1979. "The Urban Basis of Political Alignment: Social Class, Domestic Property Ownership, and State Intervention in Consumption Processes," British Journal of Political Science, Cambridge University Press, vol. 9(4), pages 409-443, October.
    16. McGovern, Patrick & Hill, Stephen & Mills, Colin & White, Michael, 2007. "Market, Class, and Employment," OUP Catalogue, Oxford University Press, number 9780199213382.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Rachel Ong ViforJ & Hiroaki Suenaga & Ryan Brierty, 2024. "Homeownership and subjective well-being: Are the links heterogeneous across location, age and income?," Urban Studies, Urban Studies Journal Limited, vol. 61(5), pages 859-877, April.
    2. Jelke R. Bosma, 2022. "Platformed professionalization: Labor, assets, and earning a livelihood through Airbnb," Environment and Planning A, , vol. 54(4), pages 595-610, June.
    3. Martijn Konings & Lisa Adkins & Dallas Rogers, 2021. "The institutional logic of property inflation," Environment and Planning A, , vol. 53(3), pages 448-456, May.
    4. Tom Barnes, 2024. "Rethinking job loss in an age of assetisation: Lessons from the study of precarious older workers," Environment and Planning A, , vol. 56(3), pages 717-735, May.

    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. Andrew Leigh & Adam Triggs, 2016. "Markets, Monopolies and Moguls: The Relationship between Inequality and Competition," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 49(4), pages 389-412, December.
    2. Spies-Butcher, Ben & Bryant, Gareth, 2024. "The history and future of the tax state: Possibilities for a new fiscal politics beyond neoliberalism," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 98(C).
    3. Nicolas Hérault & Dean Hyslop & Stephen P. Jenkins & Roger Wilkins, 2024. "Rising top‐income persistence in Australia: Evidence from income tax data," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 70(1), pages 154-186, March.
    4. Stephen Bell & John Quiggin, 2006. "Asset Price Instability and Policy Responses: The Legacy of Liberalization," Journal of Economic Issues, Taylor & Francis Journals, vol. 40(3), pages 629-649, September.
    5. Dögüs, Ilhan, 2016. "A Minskyan criticism on the shareholder pressure approach of financialisation," ZÖSS-Discussion Papers 53, University of Hamburg, Centre for Economic and Sociological Studies (CESS/ZÖSS).
    6. Engelbert Stockhammer & Rafael Wildauer, 2016. "Debt-driven growth? Wealth, distribution and demand in OECD countries," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 40(6), pages 1609-1634.
    7. Biagio Bossone, 2021. "Bank Seigniorage in a Monetary Production Economy," Working Papers PKWP2111, Post Keynesian Economics Society (PKES).
    8. Kumlin, Staffan, 2000. "Ideology-driven public opinion formation in Europe: The case of third sector attitudes in Sweden," Discussion Papers, Research Unit: Institutions and Social Change FS III 00-202, WZB Berlin Social Science Center.
    9. Dirk Antonczyk & Thomas DeLeire & Bernd Fitzenberger, 2018. "Polarization and Rising Wage Inequality: Comparing the U.S. and Germany," Econometrics, MDPI, vol. 6(2), pages 1-33, April.
    10. Anthony B. Atkinson & Thomas Piketty & Emmanuel Saez, 2011. "Top Incomes in the Long Run of History," Journal of Economic Literature, American Economic Association, vol. 49(1), pages 3-71, March.
    11. Hasan, Iftekhar & Horvath, Roman & Mares, Jan, 2020. "Finance and wealth inequality," Journal of International Money and Finance, Elsevier, vol. 108(C).
    12. Christian A Belabed & Thomas Theobald & Till van Treeck, 2018. "Income distribution and current account imbalances [Notes on capacity utilisation, distribution and accumulation]," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 42(1), pages 47-94.
    13. Timothy K.M. Beatty & Erling Røed Larsen & Dag Einar Sommervoll, 2005. "Measuring the Price of Housing Consumption for Owners in the CPI," Discussion Papers 427, Statistics Norway, Research Department.
    14. Laurence Troy, 2018. "The politics of urban renewal in Sydney’s residential apartment market," Urban Studies, Urban Studies Journal Limited, vol. 55(6), pages 1329-1345, May.
    15. Mike Pottenger & Andrew Leigh, 2016. "Long-Run Trends in Australian Executive Remuneration: BHP, 1887–2012," Australian Economic History Review, Economic History Society of Australia and New Zealand, vol. 56(1), pages 2-20, March.
    16. Christophe André, 2016. "Household debt in OECD countries: stylised facts and policy issues," Chapters from NBP Conference Publications, in: Hanna Augustyniak & Jacek Łaszek & Krzysztof Olszewski & Joanna Waszczuk (ed.), Papers presented during the Narodowy Bank Polski Workshop: Recent trends in the real estate market and its analysis - 2015 edition, chapter 2, pages v1, 33-85, Narodowy Bank Polski.
    17. Felipe Encinas & Carlos Marmolejo-Duarte & Carlos Aguirre-Nuñez & Francisco Vergara-Perucich, 2020. "When Residential Energy Labeling Becomes Irrelevant: Sustainability vs. Profitability in the Liberalized Chilean Property Market," Sustainability, MDPI, vol. 12(22), pages 1-17, November.
    18. Josh Ryan-Collins, 2021. "Breaking the housing–finance cycle: Macroeconomic policy reforms for more affordable homes," Environment and Planning A, , vol. 53(3), pages 480-502, May.
    19. C J Pattie & R J Johnston, 1990. "Thatcherism—One Nation or Two? An Exploration of British Political Attitudes in the 1980s," Environment and Planning C, , vol. 8(3), pages 269-282, September.
    20. Botta, Alberto & Caverzasi, Eugenio & Russo, Alberto, 2024. "Same old song: On the macroeconomic and distributional effects of leaving a Low Interest Rate Environment," Structural Change and Economic Dynamics, Elsevier, vol. 69(C), pages 552-570.

    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:sae:envira:v:53:y:2021:i:3:p:548-572. 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: SAGE Publications (email available below). General contact details of provider: .

    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.