Lane Kenworthy has done some of the best work on this subject. Read all his stuff.
One great piece, on determinants of growth:
Institutions, wealth, and inequality
Only one institutional factor is strongly supported as a determinant of growth in prosperous countries, according to Lane’s really excellent statistical work: “corporatist concertation.”
Corporatist concertation is not what you think. It’s euphemistic sociologist-speak for labor having a strong place and voice at high-level bargaining tables — not just in labor negotiations, but in determining the institutional and policy structures that set the rules of the game.
Labor power is the strongest determinant of growth in prosperous, advanced countries. More labor power, faster growth.
I’d love to see equally well-executed statistical work analyzing labor-share of income and wealth relative to economic growth across prosperous countries.
Cross-posted at Angry Bear.