Saturday, August 27, 2016

Barry Eichengreen on economic inequality over history

Barry Eichengreen - presentation on inequality through history (pdf).

When you get to slide 16 it becomes rather obvious that economic inequality is almost entirely driven by exogenous political decisions, not by anything economically endogenous.

The new (post-1980) boost in inequality also turns out to be obviously the result of overt political action, since he notes it can be seen more in English-speaking countries than in continental Europe. Yet as he notes,

"skill-biased technological change (favoring the relatively well educated) and globalization (disfavoring the unskilled in the advanced countries) are the popular explanations."

It's funny that a social science so infused with politics tries so hard to deny the effect of politics.

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