The Age of Dualization

<jats:title>Abstract</jats:title> <jats:p>Poverty, increased inequality, and social exclusion are back on the political agenda in Western Europe, not only as a consequence of the Great Recession that hit the global economy in 2008, but also as a consequence of a seemingly structural trend towards increased inequality that began some time ago. How can we explain this increase in inequalities? In this book, it is argued that social and labor market policies contribute to shaping the forms and extent of the new inequalities and divides that challenge European societies. Growing inequality is related to processes of dualization, i.e. a widening, deepening, or the creation of new insider-outsider divides. The processes of division in the realms of labor markets, social policy and political representation are strongly linked. Dualization is certainly not the only driver of increasing inequality, but because of the encompassing development evidenced in this book, dualization appears one of the most important current trends affecting developed societies. However, the extent and forms of dualization observed vary greatly across countries. The comparative perspective of this book provides insights into why some countries witness lower levels of insider-outsider divides, whereas for others, they have become a core characteristic. Most importantly, the comparisons presented in this book point to the crucial importance of politics and political choice in driving and shaping the social outcomes of deindustrialization. Governments “cope” in different ways with deindustrialization. Hence, while increased structural labor market divides can be found across all countries, governments have a strong responsibility in shaping the distributive consequences of these labor market changes. Insider-outsider divides are not a straightforward consequence of deindustrialization, but rather the result of policy, i.e. of political choice.</jats:p>