I’ve been reading Branko Milanovic’s new book [amazon_link id=”067473713X” target=”_blank” ]Global Inequality: A New Approach for the Age of Globalization[/amazon_link]. I’ll be reviewing it for the journal Democracy, not for here.
[amazon_enhanced asin=”067473713X” /]
It adds to a recent literature on inequality, of which Thomas Piketty’s [amazon_link id=”067443000X” target=”_blank” ]Capital in the 21st Century[/amazon_link] is the best known, but also includes some excellent books with a lower public profile – Anthony Atkinson’s [amazon_link id=”0674504763″ target=”_blank” ]Inequality[/amazon_link] and François Bourguignon’s [amazon_link id=”069116052X” target=”_blank” ]The Globalization of Inequality[/amazon_link]. I liked the Atkinson book especially for its down-to-earth list of supremely practical policy proposals to reduce inequality. About the Milanovic book I’ll just say for the moment that it will be another must-read on the subject, and includes a super-clear overview of the global income inequality data as well as a persuasive analysis of the forces driving inequality trends (far more persuasive than Piketty’s determinism).
[amazon_image id=”067443000X” link=”true” target=”_blank” size=”medium” ]Capital in the Twenty-First Century[/amazon_image] [amazon_image id=”0674504763″ link=”true” target=”_blank” size=”medium” ]Inequality[/amazon_image] [amazon_image id=”069116052X” link=”true” target=”_blank” size=”medium” ]The Globalization of Inequality[/amazon_image]
Why now? The answer to that is surely events; a degree of inequality tolerable when the economy was booming is intolerable now there is less growth. Does it matter? Just read Martin Wolf’s sobering column today (£) (The Economic Losers Are in Revolt Against the Elites) to appreciate why it might. These are fragile times, whether you look at migration, climate change, global epidemics, demography, populism – exactly the circumstances when you would want people to be pulling together rather than diverging into separate worlds (Davos-land, middle England or America, refugee camps) due to such big differences in income. Milanovic’s book lends weight to Wolf’s pessimism: “If western elites despise the concerns of the many, the latter will withdraw their consent for the elite’s projects. In the US, elites of the right, having sown the wind, are reaping the whirlwind. But this has happened only because elites of the left have lost the allegiance of swaths of the native middle classes.”
Always love your blogs (which I learned is the British word for “post”).
This sentence – “a degree of inequality tolerable when the economy was booming is intolerable now there is less growth” – got me thinking. I believe it is pretty well-known, though I don’t have a reference right now, that people are very bad at understanding just how much inequality there is. They are much better at understanding recent growth trends. But if people think of the economy as mostly a zero-sum game, then whenever actual growth came short of their expectations, they would blame inequality – whether or not it was actually increasing.
If – and that’s a big if – this is true, then tackling inequality will not solve restlessness among the people. I know I would like there to be more equality in the world, but if we are trying to save institutions, should we not be more focused on measures that would increase growth more than on redistribution? Or better yet, shouldn’t we we focus on the kinds of measures which would both reduce inequality and accelerate growth?
Allons enfants de la patrie…….etc.
There is a lot of material that covers the side of economic losers. Picketty, Stiglitz, Atkinson, Milanovic, Bourguignon etc etc.
My question – Is there any book that covers the other side ? the side of the 1% ?
I haven’t read this but the reviews for Chrystia Freedland’s book were excellent: http://www.amazon.co.uk/Plutocrats-Rise-New-Global-Super-Rich/dp/0141043423/ref=sr_1_1?ie=UTF8&qid=1453966727&sr=8-1&keywords=chrystia+freedland