Income inequality is a major political topic these days. And politicians on the left of the political spectrum tend to promote their policies as ones that will reduce income inequality (typically through higher taxes for high-income households). But what is the actual track record of left-of-centre politicians in reducing income inequality? Note, that I explicitly exclude the left-wing nutjobs in Venezuela, Cuba, Bolivia, etc. who implement policies that are way beyond anything that is realistic in Western Europe or North America. Brandishing left-of-centre politicians in the United States or the UK as socialists and comparing them with Chavez and Castro is just a stupid bogeyman for people who have no arguments.
I'm not sure this paper shows what its authors think it does.
State governments in Germany are competing for talent like everybody else. Germany has incredible labour mobility, that's one of its biggest strengths. Moving and changing your residency is comparatively easy. Infrastructure is excellent, so even weekend commutes between states are a thing.
My point is that ideology is secondary to the practical matter of talent retention in a geographically small country with high levels of labour mobility. A government that deviates too far from the average is going to find itself struggling to keep its people.
I could not find any mention that labour mobility was considered, nor costs of living. Just an eyeball assessment of the compensation tables for civil servants yields an utterly unsurprising pattern: Bavaria and Baden-Württemberg pay the best. (Have you ever tried renting a place in the Munich metropolitan region? You'd have trouble finding an affordable telephone booth to live in, even with a good civil service salary.)
What drove the reform in 2006 in the first place? My conjecture: the desire of some state governments to obtain an advantage and compensate for the peculiarities of their regional labour markets. I'm assuming that the old structure had some means for considering local costs of living. To the extent that it didn't, states like Bavaria would have been at a profound disadvantage.
Conversely, today, talented people considering a career in the civil service have options. They can look at an offer on the table in Brandenburg and compare it with opportunities in Bavaria. Some can and do move. That's naturally going to put pressure on all governments to keep up.
The differences in the pay levels between states are truly miniscule (+- 5%). That suggests that there are structural pressures on pay that drown out any impact government ideology could have. I'm not sure you can draw the conclusion from this that left-wing governments don't care. They might just be caught in a competitive trap that results from open internal borders.
Also, there are MANY more public employees than civil servants(more than 4x!), and in 15 of 16 states, their pay is governed by a single collective agreement. For those, there is (for all practical purposes) no difference.
Finally, as a former physicist, you might appreciate this: There is a difference between declared ideology and practical ideology. What is happening in reality? How are you supposed to quantify this? Does SPD on the tin really mean social democratic policy inside? Many would argue that hasn't been true for years.
All in all, this paper is pretty silly and is illustrative of the problems with macroeconomics and econometrics. I think Master Yoda once said, "A mathematical model does not the truth make."
I'm not sure this paper shows what its authors think it does.
State governments in Germany are competing for talent like everybody else. Germany has incredible labour mobility, that's one of its biggest strengths. Moving and changing your residency is comparatively easy. Infrastructure is excellent, so even weekend commutes between states are a thing.
My point is that ideology is secondary to the practical matter of talent retention in a geographically small country with high levels of labour mobility. A government that deviates too far from the average is going to find itself struggling to keep its people.
I could not find any mention that labour mobility was considered, nor costs of living. Just an eyeball assessment of the compensation tables for civil servants yields an utterly unsurprising pattern: Bavaria and Baden-Württemberg pay the best. (Have you ever tried renting a place in the Munich metropolitan region? You'd have trouble finding an affordable telephone booth to live in, even with a good civil service salary.)
What drove the reform in 2006 in the first place? My conjecture: the desire of some state governments to obtain an advantage and compensate for the peculiarities of their regional labour markets. I'm assuming that the old structure had some means for considering local costs of living. To the extent that it didn't, states like Bavaria would have been at a profound disadvantage.
Conversely, today, talented people considering a career in the civil service have options. They can look at an offer on the table in Brandenburg and compare it with opportunities in Bavaria. Some can and do move. That's naturally going to put pressure on all governments to keep up.
The differences in the pay levels between states are truly miniscule (+- 5%). That suggests that there are structural pressures on pay that drown out any impact government ideology could have. I'm not sure you can draw the conclusion from this that left-wing governments don't care. They might just be caught in a competitive trap that results from open internal borders.
Also, there are MANY more public employees than civil servants(more than 4x!), and in 15 of 16 states, their pay is governed by a single collective agreement. For those, there is (for all practical purposes) no difference.
Finally, as a former physicist, you might appreciate this: There is a difference between declared ideology and practical ideology. What is happening in reality? How are you supposed to quantify this? Does SPD on the tin really mean social democratic policy inside? Many would argue that hasn't been true for years.
All in all, this paper is pretty silly and is illustrative of the problems with macroeconomics and econometrics. I think Master Yoda once said, "A mathematical model does not the truth make."