Income policy

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Income policy ( English income (s) policy ) comprises the economic policy measures of the state, which, often in cooperation with business and employee associations, influence the development of wages, salaries and prices. One of the main goals of income policy is to combat inflation by stabilizing the price level . In this way, income policy differs from a policy that seeks to influence the distribution of income . In addition to the economic and stability policy goal, state income policy can also aim to secure a minimum income .

Income policy is "part of the economic policy instruments" and its origin was the conflict of goals between full employment and monetary stability . The early protagonists of a full employment policy in Great Britain and Sweden viewed it as a compensatory instrument to resolve this conflict of goals. According to the proposal of the British welfare economist Lord Beveridge, the inflationary effects of wage policy to be expected with full employment should be kept under control with the help of a “wages office”.

Methods of Income Policy

Income policy can achieve its goals through various economic policy measures. According to Wilhelm Rall, they can be differentiated into a) indicative, b) imperative and c) cooperative methods

  • Indicative income policy

With information, orientation data and moral persuasion , the state tries to influence the actions of the collective bargaining associations in order to achieve price stability.

  • Imperative income policy

The state issues ordinances and laws with binding "guidelines", in extreme cases a wage and price freeze, in order to control wage and price policy decisions.

  • Cooperative income policy

The state and associations voluntarily agree to comply with jointly developed guidance data for wage and price increases. The concerted action is a historical example of this .

minimum wage

The minimum wage introduced by state legislation sets a binding lower limit for the hourly or monthly wage, which may only be fallen below in defined exceptional cases.


  • Christiane Busch-Lüthy: Macroeconomic wage policy. Mohr, Tübingen 1964.
  • Heinz-Dieter Hardes: Income policy in the FRG. Stability and Group Interests: The Case of Concerted Action. Herder & Herder, Frankfurt am Main 1974.
  • Wilhelm Rall: On the effectiveness of income policy. Mohr, Tübingen 1975.

Web links

Individual evidence

  1. Joachim Klaus / Manfred Gömmel: Different approaches to income policy . In: Bernhard Külp / Wolfgang Stützel (eds.): Contributions to a theory of social policy . Berlin 1973, p. 175.
  2. ^ Goetz Briefs: State and Economy in the Age of Interest Associations. In the S. (Ed.): Laissez-faire-Pluralism . Duncker & Humblot, Berlin 1966, p. 194.
  3. ^ On the effectiveness of income policy , Mohr (Paul Siebeck), Tübingen 1975