Cooperative Institutions and Inequality in the OECD: Bringing the Firm Back In

Objective. To examine the relationship between firm-level cooperation, inequality, and redistribution in 18 advanced industrialized democracies. Methods. The relationships are investigated using multiple regression analyses of institutional, political, and economic variables. Results. Multilevel models reveal that contrary to neocorporatism, firm-level cooperative ties have significant inegalitarian effects, particularly in the distribution of pretax, pretransfer market income. The effects, however, are also felt in the distribution of posttax, posttransfer income. Conclusion. By paying attention to the effect of firm-level cooperation, the study sheds new light on inequality in the OECD as a result of both market-based and non-market coordination.