THEORY OF ECONOMICS

QUESTION

oxy.cdu.edu.au/cgi-bin/library?a=q&r=1&hs=1&e=p-000-00—0ntlier–00-0-0-0prompt-10—4——0-1l–1-en-50—20-about—00001-001-1-0utfZz-8-0&h=dtt&t=1&q=Class

SOLUTION

Topic: Is Australia a classless society?

 

 

Australia has considered itself for quite some time as an equal society, where equal opportunities and freedom flourishes for all the people. Since the nation of Australia is put together and constructed on the base of convict labour, it provides equal and at par opportunities to the millions of, migrants coming to Australia. This is the reason why Australia feels proud for developing a society which they refer to as completely egalitarian society.

This essay closely scrutinizes the real meaning of class and how some of the theories of capitalism and socialism relate it to Australian society. This essay will also study and observe the perception of class in people’s mind along with the mobilisation of the classes and finally it investigates the effect and influence of class on various sectors of society like health, crime and education. These kinds of perception will be helpful in showing the real correlation between the classes and whether Australia has class system or not, or Australia is simply a classless society.

Class system is currently visible in the present education system, where there is surely visible social hierarchy, disparity in opportunities and social status. The health care system prevalent in Australia also indicates that Australia is not a classless society because there is existence of public health care system ( Medicare) , private healthcare system and  in this section  of healthcare there exist unequal opportunities too.

In order to analyse the class system existing in Australia it is very vital to define the major terms like class, egalitarian society etc.

Karl Marx Theory of Capitalism

 

Social Construction has been defined as a phenomenon which has been invented or rather constructed by the members who belong to specific society or culture (Arvantiakis, 2009). Class has been defined as division in society which consists of group of people, who have same kind of economic and social status (Marx, 1847).

Marxist approaches have been contrasting to Weberian approaches which emphasis the ownership and non-ownership of means of production while defining the workers and employers the measures of social classes are very categorical by Marxist and Neo-Marxists. they have divided into three class groups that is workers,  self-employed and  large employers (Bourdieu, 1984).During the 1950’s and 1960’s the studies of social stratification done in context with Australia and America it was found that the main emphasis was on  occupational prestige.

As per definition given by Arvantiakis social status depends upon the person’s social background which includes where the people reside, what kind of occupation they indulge in, which school do they attend and with whom do they socialise (2009). This way if we see the class can be defined as division in our society which is totally based upon social and wealth aspects of people in the society. There are four types of classes which have been defined in the society: lower class, middle class, working class and the upper class.

 

Max Weber’s Theory

 

Max Weber’s Theory says that there are more than four types of classes in the society and it is much nearer to the class structure in Australia. Today if we analyse Australia has much more than four types of classes which exist in the society (Weber, 1968). According to Max Weber’s Theory all the communities across the globe are arranged in such a way that tangible and intangible, goods, material or symbolic get distributed and this kind of distributions is all the time unequal and it involves power too compulsorily. A said by Weber, classes, parties and status groups are basically the main phenomenon which works behind this distribution of power in any community (MAX WEBER : Basic Terms (The Fundamental Concepts of Sociology)). The Classes of the community makes up economic order in the society whereas the status groups create social order and finally the parties are responsible for creating political or legal order (Weber, The Protestant Ethic and The Spirit of Capitalism, 1958).

Weber defined class in terms of market situation and said that a class exists when varied number of people should have a causal component in common related to the life chances. This component is shown in the form of possession of goods in the economic interest and creating opportunities for income through creation of labour or commodity markets (Richard, 1999) . The Weber’s way of recognising the diversity of assets which brings about returns in the market is all because of the proliferating nature of the classes which have been termed as ‘economic classes’ and we can very well see the existence of these economic classes in the Australian society and social classes are merely aggregation of economic classes (Weber, Economy and Society (2 vols), 1978).

 

Egalitarianism in Australia

 

Egalitarianism is regarded as a slippery notion, because it exists at various levels in society (Thompson, 1994). It is a combination of beliefs which is created over the time and is spread in the form of popular culture in the society According to this belief one states that Australia is a classless society because it seems that here wealth and income is evenly distributed and everyone can purchase and own their personal house and moreover the special styles of rich and poor are almost alike.

 

Current Socio-Economic Status in Australia

 

As a social norm Australians always believe overwhelmingly in equality of opportunity, this is the reason which makes Australia most socially mobile society amongst all others in the whole world. This they do by following six goals:

  • Full time employment for anyone who wants to work.
  • Balanced bargaining power at workplace
  • Strong and progressive tax system
  • Set of minimum wages is being legislated and creates sufficient conditions for standard of living.
  • A community-based, dignified and means-tested social transfer safety net in order to cover the short-term contingencies.
  •  Finally equal access to public goods has been rewarded like good and quality education, housing, transport and public healthcare (Argy, 2006).

As predicted by Headey and Muffels (Headey & Muffels, 1999) Australia after studies will emerge as the most mobile societies in the world and it is helpful in explaining the hard perception which is being shown by Australians related to  passive distribution (Alesina & La Ferrara, 2004). Occupational mobility in Australia is showing upward trend and it has been found that generic training and education will lead to upward job movement as well as occupational change as compared to no training at all or on-the-job training (Shah & Burke, 2004). This is the reason why in Australia the ‘middle class’ is shrinking (Pressman, 2004).

As per the studies conducted on income mobility based on first one year and then two year and  three year income for a periods of 2001-2003 , it has been found that Australia is much more ,mobile than  U.K., Germany or U.S.A. (Leigh, 2005). Since 1960’s the Australian mobility regarding the level of inter-generational mobility in Australia has shown very strong tendency that is it has neither increased nor decreased which is a positive sign (Leigh, Intergenerational mobility in Australia, 2006).

 

 

 

Eric Olin Wrights Theory of Class

 

It is really strange that most of sociologists still study Marx although he is considered to be wrong as he predicted a revolution which never happened. In order to counter the problem of predictability in the Marx’s Theory the level of analysis has been raised and Analytical Marxism was being developed by Eric Orin Wright.

Analytical Marxism handles the issue by keeping a focus on just eth scientific clarification of analytical concepts developed by Marx’s and mainly and specifically focussing on ‘classes. According to Wright (Wright, 1994) there are basic four characteristics which are found in Analytical Marxism:

  • Being committed to conventional and scientific norms
  • Explanation of the steps and the connections between various concepts in the theory.
  • Individual actions which are done intentionally have been given  much importance
  •  Systematic conceptualisation has been prioritised (Erik Olin Wright:Analytical Marxism).

All these are characteristics of analytical Marxism and found in the Theory given by Wright also. As a micro-level concept Wright visualises class as merely different sets of locations which are being fulfilled by various individuals (Wright, Rethinking, once again, the concept of class structure, 1989). According to him being in class location means being subjected to a set of  systems which affect and impinge directly the life of individuals, when these individuals  act or make choices in this world. Wright specified the concept of exploitation which was totally overlooked by Marx, according to Wright there is special group of people in society who are not in possession of any means of production, but they do sell their labour and they are not considered to be part of working class (Wright, Class counts: Comparative studies in class analysis, 1997). The criterion of exploitation developed by Wright indicates that there is qualitative variation in the level of exploitation and it is this exploitation which is bale to create interdependencies but an antagonistic relationship between the capitalist and the workers in the society. This in future creates better working conditions and wages for the working class. This concept is what has been witnessed in Australia in the long run and that is why there is shrinkage in the middle class which is quite evident and indicates that Australia is truly an example of classless society.

 

Emile Durkheim-mechanical and organic solidarity

 

In “Division of labour in Society” Durkheim has done a critical analysis of the various differences which exist between traditional or rural or agricultural society and industrial modern or urban society (Indian, 2011).” Organic solidarity” is the name being given to agricultural society whereas the” mechanical solidarity” is eth characterisation of the industrial society. According to Durkheim the societies are a result of homogenous and simple population which then develop into advanced stages and division of labour can be seen in the society and any explanations regarding the deviance should also depict change. In mechanical solidarity all eth members sued to perform similar functions which lead to inform values which resulted in Collective Conscience, which is found to be very strong in mechanical solidarity (Misis, 2011). Whereas organic solidarity is found when people in the society show dependency upon other groups due to highly specific division of labour and the primary regulatory authority is law which controls and regulates the interactions thus helping in maintaining the solidarity between the groups? This clearly indicates that mechanic solidarity is primitive aspect in relation to Australian culture and society and now they follow organic solidarity where there is specific division of labour and the groups are dependent upon each other (Misis, 2011). Being, multicultural and multiethnic in nature Australia too depicts organic solidarity.

If we look back and study the past thirty years of Australian economy and culture, it has been noticed that economic liberalisation policies and labour market deregulation when combined with social activism has been the main reason behind Australians success. This is the reason why Australia boasts of stronger economy with moderate amount of income which is stable and the levels of wealth inequality are also very low. If we judge Australia with respect to U.S., it has high level of sail mobility too. But eth fundamentally changing social policy environment in Australia is happening because the Australians are fatly adopting American social norms and the experience in case of America clearly suggest that it will lead to lesser amount of social mobility.

It has already been found that the interaction between the market forces and policy development has created a two-tier society in the fields of transport, health, education, employment and housing. This might lead to formation of distinct classes in the society as in case of U.S. and U.K. Thus if Australia needs to stay as classless society, it would have to develop a strategy which should be able to explain that why they need to invest in order to create better society by levelling the playing fields. Perhaps the Australians still hold the myth which is dearest to their heart that Australian society is classless society, but the trends are changing with the widening gap between the divisions created due to wealth and opportunity and this widening gap is responsible for creating classes in the society which Australian government must try to tackle to maintain the social mobility in the society.

 

 

Bibliography

Alesina, A., & La Ferrara, E. (2004). Preferences for redistribution in the land of opportunities. Journal of Public Economics , 897-931.

Argy, F. (2006). Equality of Opportunity in Australia Myth and Reality. The Australia Institute .

Bourdieu, P. (1984). Distinction: A Social Critique of the Judgement of Taste. Cambridge: Harvard University Press.

Erik Olin Wright:Analytical Marxism. (n.d.). Retrieved May 31, 2012, from Sage Publications: http://www.ssc.wisc.edu/~wright/Social%20Class%20–%20Sage.pdf

Headey, B., & Muffels, R. (1999, December). Up and dow. IPA Review .

Indian. (2011, february 20). Emile Durkheim: Organic Solidarity and Mechanical Solidarity . Retrieved May 31, 2012, from INDIAN TAKE: http://indiantake.blogspot.in/2011/02/durkheim-organic-solidarity-mechanical.html

Leigh, A. (2006, January). Intergenerational mobility in Australia. Research School of Social Science, ANU Draft .

Leigh, A. (2005, September). Permanent Income inequality: Australia, Britain, Germany and the United States. Research School of Social Sciences, ANU, Draft .

MAX WEBER : Basic Terms (The Fundamental Concepts of Sociology). (n.d.). Retrieved May 31, 2012, from Sociological Theory: http://ssr1.uchicago.edu/PRELIMS/Theory/weber.html

Misis, M. L. (2011). EMILE DURKHEIM: Class Notes for CJ 325_Spring 2011. Retrieved May 31, 2012, from USM .edu: http://www.usm.edu/cj/Syllabi/Misis/CJ%20325_Emile%20Durkheim4.pdf

Pressman, S. (2004). The decline of the middle class: an international perspective. Working Paper No. 280, Economics and Finance Faculty, Monmouth University .

Richard, S. (1999). Max weber as an economist and as a socialogist-Twords a fuller understanding of Weber’s view of Economics. The American Journal of economics and Sociology .

Shah, C., & Burke, G. (2004, December). Labour mobility. paper presented to ALMR workshop .

Thompson, E. (1994). Fair Enough: Egalitarianism in Australia. Sydney, NSW: University of New South Wales Press.

Weber, M. (1978). Economy and Society (2 vols). Berkley: University of California Press.

Weber, M. (1968). Economy and Society. New York: Bedminister Press.

Weber, M. (1958). The Protestant Ethic and The Spirit of Capitalism. New York: Scribner’s Press.

Wright, E. O. (1997). Class counts: Comparative studies in class analysis. Cambridge: cambridge University Press.

Wright, E. O. (1994). Interrogating inequality: Essays on class analysis, socialism and Marxism. London: Verso.

Wright, E. O. (1989). Rethinking, once again, the concept of class structure. London: Verso.

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