Rapid changes in inequality : present, past, and theory

Abstract

Since about 1970, inequality of income and wealth has increased sharply in most industrialized countries – most strongly in the USA and UK, but also in almost all English-speaking countries and, more recently, in Germany, Belgium, Israel, and even Sweden. Expert opinion strongly divides over both the causes and the consequences of this development, and in particular over the link between economics and politics. Among the possible causes most frequently adduced are “globalization,” a more complex (e.g., computer-based) technology, shortcomings in educational policy, and neo-liberal policies. The consequences have been portrayed mostly vividly by writers of fiction but have also interested theorists of economic growth. The present essay seeks to illuminate the issue both theoretically and by comparison with previous periods of rapid change in inequality. A closer examination of the economic, political, and technological effects of the Black Death in Fourteenth Century Europe serves as a “plausibility check” of the general argument.