Analyse of InCome Inequality in Germany in Regard of Three Social Factors

Introduction

The social phenomena of income inequality in Germany will be discussed in this paper. Income inequality in Germany will be examined explicitly over the past years to the present, in regard to German and English-speaking literature.

Furthermore, structural functionalism, one of the major theoretical perspectives in sociology, developed by Emile Durkheim, will be elucidated. Further, Emile Durkheim’s theory that crime is normal will be demonstrated through the application of his structural functionalism perspective.

Subsequently, the structural functionalism theoretical theory of Emile Durkheim will be applied to investigate the functions of income inequality by analyzing “Unemployment benefit two”, “Germany’s education system” and “Immigrant growth in Germany”. Income inequality in Germany

The German well-known newspaper “Welt” reported that the issue of inequality is currently hotly debated in Germany. This started by Marcel Fratzscher, who wrote in his book "Distribution Fight” that Germany is "the land of inequality” (Greive, 2016). Other Social Associations even declared that growing income inequality is becoming a threat. Further, the head of the political party SPD, Sigmar Gabriel announced that he wants to make income inequality as his central election campaign (Greive, 2016).

However, the economy in Germany is growing, German exports are breaking new records every year, and unemployment is as low as it has been for a long time. Does income inequality increases, even though Germany experiences a strong and continuous economic growth? The German newspaper argued capital incomes are rising more than salaries, therefore income inequality increases. This claim is based on the theory that the French economist Thomas Piketty has made. His argument: who is rich, invests in stocks or real

estate and earns higher income than employees from work. Through this kind of fundamental principle of capitalism, the inequality is increasing (Greive, 2016). An investigation by the Hans Böckler Foundation came to the result, that German employees earned two percent more wages per year, while corporate profits and income increased by 3.3 percent annually (Schmid and Stein, 2016).

Before we go further, it is essential to define income inequality first. The general concept of income inequality refers to the unevenly distribution of income among individuals or groups (Adler and Schmid, 2012).

According to Dorothee Spannagel, Head of Division for Distribution Policy at the Economic and Social Science Institute of the Hans Böckler Foundation, it is undisputed that income inequality is much higher today than it was 20 years ago. Between 1999 and the mid-2000s, the uneven distribution of the available household income increased significantly (Spannagel, 2013). Income inequality initially reached its peak in 2005, followed by a phase in which the increase had not continued or had declined slightly. However, according to the Hans Böckler Foundation, the inequality has risen again since 2010 and the long-term trend of income inequality goes up, despite the interim recovery phases (Schmid and Stein, 2016)

To measure income inequality over the past, the Gini index of equivalized net household income from Socio-Economic Panel can also be used (SOEP, 2017). It shows that in 1991, it was 24.8 points and increased dramatically until 2006 with around four points. The results of observations can be found in the appendix 1 - Gini coefficient of next household income, 1991-2015. From there it constantly increased until the last time measured in 2015. Theoretical Perspective: Structural Functionalism

There are three major theoretical perspectives in sociology: Structural functionalism perspective, conflict perspective and the symbolic interaction perspective (Mooney, Knox and

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Schacht, 2007). As already stated in the introduction, structural functionalism will be applied to analyze the paper’s subject later on.

Emile Durkheim is the founding father of structural functionalism and also considered as the first formal sociologist. Structural functionalism was the first main theoretical perspective in sociology and was developed out of Emile Durkheim’s understanding of how society works (Coser, 2003). In Durkheim’s belief, society is a system of interconnected components that work together in harmony to maintain a state of balance and social equilibrium for the whole (Mooney et. al., 2007). If anything happens to interrupt the order and the flow of the system, society must adjust to achieve a stable state. According to Durkheim, society should be analyzed and described in terms of functions. Society is a system of interrelated components where no one can function without the other. These components make up the whole of society. If one component changes, it has an impact on society as a whole (Durkheim, 1974).

In regard of social facts, the term "function" can be used in preference to "end" or “purpose" precisely because social facts do not generally exist for the useful results they produce (Pope, 1975). However, Durkheim strongly believed all social facts that exist and are maintained commit themselves to the peace, tranquility and health of the whole (Coser, 2003).

Durkheim used Structural functionalism to research crime and argued that crime was functional, even though crime was universally viewed as bad. In fact, it is still seen as bad and most politicians consider crime as an issue. However, Durkheim argued that crime should be seen as something functional and necessary for society rather than something neurotic, and a symptom of an unhealthy society (Coser, 2003). Regarding to his statement, previously mentioned, crime exists, is maintained (even though it might occur in different

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levels in different societies) and lastly it commits itself to the peace, tranquility, and health of the whole (Coser, 2003). 


By pointing out the fact that crime seems to be existing in all societies since the beginning of human history, Durkheim argued that crime is a condition of normality, which also reflects in his theory that crime is maintained within all societies to a certain degree. Therefore, Durkheim contended that crime is functional.

One major social functions, Durkheim saw in crime is for instance that crime defines the right and wrong values for those within the society. By punishing criminals, society corroborates it own values. If crimes were not committed, then the values of society would become forgotten (Coser, 2003).

Analysis of other social phenomenons related to income inequality

Income