Home Business In ‘Inequality,’ A Respected Scholar Wades Into A Contentious Political Issue

In ‘Inequality,’ A Respected Scholar Wades Into A Contentious Political Issue

In ‘Inequality,’ A Respected Scholar Wades Into A Contentious Political Issue by Jonathan A. Knee, The New York Times

The crisis of “income inequality” has become a cause célèbre. Until recently, the gap between the rich and poor was a topic rarely championed aggressively even by the more liberal wing of the Democratic Party out of fear of being branded a tax-and-spender or class warmonger.

Now, both declared and would-be Republican presidential contenders are trying to gain advantage over one another with the depth of their concern over how much of the pie is going to the very richest. “We’re facing right now a divided America,” the conservative Ted Cruz recently complained, “the top 1 percent earn a higher share of our national income than any year since 1928.” Even the 2012 Republican ticket bearers of former Gov. Mitt Romney and Representative Paul Ryan have felt obliged to get in on the act. Each has separately expressed disappointment that since the election, “the rich have gotten richer,” which has “exacerbated inequality.”

The source of the sudden universal embrace of income inequality as “the defining issue of our time,” as former Gov. Jeb Bush of Florida recently described it, is unclear. The unexpected success of the French economist Thomas Piketty’s 700-page 2013 tome, “Capital in the Twenty-First Century” was, at a minimum, an important accelerant.

Even less clear is whether all those professing a commitment to greater income equality are actually talking about the same thing. Indeed, universal rhetorical consensus in the political realm is more than likely to mask fundamental disagreements that ensure continued finger-pointing and policy inertia.

Into this charged environment steps Prof. Anthony B. Atkinson, the godfather of modern income inequality research, whom Mr. Piketty himself describes as the “model” for his initial graduate work on the subject. There is no one better placed to summarize what the research says about the what and why of income inequality and light a path forward. Unfortunately, Professor Atkinson’s new book, “Inequality: What Can Be Done?,” papers over critical differences to preach largely to the converted.

The most interesting part of “Inequality” is its review of the historic research. What quickly becomes clear is that definitions matter enormously. Are we concerned with inequality of income or wealth? Are individuals or households the relevant unit of measure? Should we really be concerned about the absolute level of poverty rather than the difference between the bottom and the top of the pyramid?

Depending on how we answer each of these fundamental questions, the data leads to radically different conclusions. So, for instance, the drastic increase in the number of women in the work force over the decades after World War II ensured that overall household income inequality remained relatively stable even as wages of America’s top and bottom earners dispersed. Similarly, although inequality – as defined by a nonintuitive economic term called the Gini coefficient – has soared since the 1980s, the rate of poverty has remained relatively constant.

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Inequality: What Can Be Done? – Description

Inequality: What Can Be Done? by Anthony B. Atkinson

Inequality is one of our most urgent social problems. Curbed in the decades after World War II, it has recently returned with a vengeance. We all know the scale of the problem?talk about the 99% and the 1% is entrenched in public debate?but there has been little discussion of what we can do but despair. According to the distinguished economist Anthony Atkinson, however, we can do much more than skeptics imagine.

Atkinson has long been at the forefront of research on inequality, and brings his theoretical and practical experience to bear on its diverse problems. He presents a comprehensive set of policies that could bring about a genuine shift in the distribution of income in developed countries. The problem, Atkinson shows, is not simply that the rich are getting richer. We are also failing to tackle poverty, and the economy is rapidly changing to leave the majority of people behind. To reduce inequality, we have to go beyond placing new taxes on the wealthy to fund existing programs. We need fresh ideas. Atkinson thus recommends ambitious new policies in five areas: technology, employment, social security, the sharing of capital, and taxation. ? He defends these against the common arguments and excuses for inaction: that intervention will shrink the economy, that globalization makes action impossible, and that new policies cannot be afforded.

More than just a program for change, Atkinson’s Inequality: What Can Be Done? is a voice of hope and informed optimism about the possibilities for political action.

Inequality: What Can Be Done? – Review

Tony Atkinson is the godfather of modern research on the distribution of income and wealth. Combining the statistical rigor of Simon Kuznets and the radical reformism of William Beveridge, he has been a role model for entire generations of scholars. (Thomas Piketty, Paris School of Economics)

Tony Atkinson has done more than anyone else in helping us to understand the meaning of inequality, why it is important, how it has changed over time, and how it can be influenced. He is one of the great scholars of our time. (Nicholas Stern, London School of Economics and Political Science)

Atkinson thinks that the division between inequality of outcome and inequality of opportunity is largely false. He believes that tackling inequality of outcome is a very good way to tackle inequality of opportunity. (If you help a grownup get a job, her kids will have a better chance of climbing out of poverty, too.) Above all, he disagrees with the widespread assumption that technological progress and globalization are responsible for growing inequality. That assumption, he argues, is wrong and also dangerous, because it encourages the belief that growing inequality is inevitable. (Jill Lepore New Yorker 2015-03-16)

Inequality has replaced house prices as a fashionable topic for discussion. But anyone looking for a serious treatment of the problem, rather than just a dinner party conversation, should turn to [this] book by [an] eminent economist who [has] made the study of inequality [his] life’s work…[Inequality: What Can Be Done?] sets out a range of policies for bringing about a significant reduction in inequality. (Paul Collier Prospect 2015-05-01)

Like it or loathe it, this is ambitious stuff. (Tim Harford Financial Times 2015-04-24)

Atkinson is a pioneer of the study of the economics of poverty and inequality. His latest work, Inequality: What Can Be Done?, is an uncomfortable affront to our reigning triumphalists. His premise is straightforward: inequality is not unavoidable, a fact of life like the weather, but the product of conscious human behavior. (Owen Jones The Guardian 2015-04-08)

About the Author

Anthony B. Atkinson is a Fellow of Nuffield College, Oxford, and Centennial Professor at the London School of Economics and Political Science.

Inequality: What Can Be Done? by Anthony B. Atkinson