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 MPIfG Books



Olivier Godechot
Wages, Bonuses and Appropriation of Profit in the Financial Industry
The Working Rich

Translated by Susannah Dale.
London: Routledge, 2017
244 pages
ISBN 978-1-138-12396-0 | £92.00 (hardback)
ISBN 978-1-138-34380-1 | £26.59 (paperpack)
ISBN 978-1-315-64847-7 | £21.00 (ebook)
Order book directly from Routledge.




Abstract | Contents | Author




The present financial crisis led the whole world to ask questions of the financial industry. Why are wages in the financial industry so important? Are bonuses responsible for the financial crisis? Where do bonuses come from? Politicians and others urged people to believe that the crisis was the price of Wall Street’s greed and blamed the ‘bonus culture’ prevalent in the financial industry. But despite being widely condemned and the threat of tighter regulation, bonuses in the industry have shown great resilience.
Wages, Bonuses and Appropriation of Profit in the Financial Industry provides an in-depth inquiry into the bonus system. Drawing on examples from France, the City and Wall Street, it explains how and why workers in the financial industry can get such large bonuses. The book considers issues around incentives, morality and wealth-sharing among employees, including the rise of "the working rich" who have earned most from the high wages and large bonuses on offer to some employees. These people have earned a fortune through their work and new forms of exploitation in our ever-more dematerialized economy. This book shows how the most mobile employees holding the most mobile assets can exploit the most immobile stakeholders. In our world where inequalities are sharply rising, it is therefore an important study of one of the key contemporary issues.



Understanding before Regulating
Finance as a Working Rich Observatory

Part I
Bonus Practices
1   The Size of Bonuses
2   The Distribution of Bonuses

Part II
Property Rights and Power
3   Property Rights in the Firm
4   The Sense of Ownership of Profit
5   Assets and Power

Part III
Hold-Up and Labour Market

6   A Hold-Up Case
7   Towards a Model of Hold-Up
8   The Labour Market as Asset Transfer
9   What Do Heads of Trading Room Do?  
Value Creation for Wage Earners?



Olivier Godechot is codirector of MaxPo, Sociology Professor at Sciences Po, and Research Professor at CNRS, Paris, France.

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