The New Economy and earnings inequalities: explaining social, spatial and gender divsions in the UK and London

Abstract

Understandings of the new economy differ. Optimistic accounts focus on economic growth, technological progress, the increasing use of computing and information technologies, the expansion of knowledge goods, increasing opportunities, productivity, and well-being (Greenspan 1998; Coyle and Quah 2002). Manuel Castells (2001), for example, argues that we have entered a new technological paradigm – centred on micro electronics-based information/communication technologies, (ICTs) and genetic engineering. As some of these accounts recognise, while the ICT revolution facilitates increasing global integration, it is also geographically uneven. In particular, Internet access is differentiated by location, social class, gender, ethnicity, age and education, collectively referred to as the digital divide (Norris 2001; Quah 1996). Other social theorists such as Ulrich Beck (2000) and Richard Sennett (1998) are more pessimistic. They emphasize deteriorating working conditions, increasing insecurity, and individualization associated with the demise of traditional systems of social support, including trade unions and state welfare policies. This paper links these contrasting interpretations of the new economy through a conceptualisation that recognises some of the potential of ICTs, but foregrounds the widening social and spatial divisions of contemporary global capitalism. These are especially evident in neo-liberal societies where state moderation is muted. This analysis has been discussed elsewhere (Perrons 2004a); in this paper it is linked more directly to economic analyses of rising inequality, and extended further to provide a more detailed analysis of spatial inequality. The paper begins with a discussion of rising inequality at a global scale, within countries and between women and men. It then develops an alternative explanation which synthesises and extends some of the contrasting theorisations of the new economy by explicitly incorporating a gendered and spatial perspective. Finally this analysis is very briefly illustrated by some contrasting experiences of work and life in the new economy.

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