As we will see, sometimes economists and sociologists hold drastically different views when examining the same empirical evidence but at places we agree as well. My goal is not to present an overly simplistic picture or to caricaturize how sociologists or economists think about inequality. I am acutely aware that there are heterogeneous views in both enterprises and that one can find plenty of exceptions to any claims about the two disciplines. Nor do I attempt to arbitrate which is the right way to think about inequality. Rather, the point here is to stimulate a new, interdisciplinary economic thinking by juxtaposing two representative ways of thinking.
It is fair to say that the majority of economists and sociologists agree that the distribution of earnings is jointly shaped by supply, demand, and institution.
Why income inequality doesn't harm well-being - Big Think
However, there is a wide disagreement in terms of the weights of each force. Mainstream labor economics acknowledges the significance of institution but believes that supply and demand largely determine the wages in market economy. As such, the temporal or cross-sectional variation in wages represent current or past changes in either supply or demand, which are generally not directly observable.
From this perspective, rising inequality represents an increasing demand for skilled workers or decreasing demand for the less skilled, which is in turn driven by technological advancement, immigration, and trade openness. So how do sociologists think differently? To be clear, many sociologists agree that supply and demand matter and in fact have accumulated substantial research on how various closure mechanisms e. Most sociologists, nevertheless, believe that formal and informal institutions are more critical in explaining the rising inequality observed in advanced economies.
In this light, changing institutions such as the ascendance of shareholder-centered corporate governance model, finance-friendly policies since the late 70s, credentialism, and deunionization all contribute to the earnings dynamics at different parts of the distribution. This contrast has roots in how two disciplines view labor market or other form of exchange. Many economists are convinced or working under the assumption that the labor markets in capitalist societies are in general competitive.
After all, there is no reason for rational employers to purchase labor at a higher price than necessary or for employees to take worse job offers.
- Cry Havoc!: The Crooked Road to Civil War, 1861!
- How to Raise a Jewish Child: A Practical Handbook for Family Life?
- Tuna: A Key Economic Resource in the Pacific Islands (Asian Development Bank series);
- South Africa’s inequality problem needs new thinking | UCT News.
Some economists further believe that the Efficient-market Hypothesis, to a large extent, holds true in labor market, and thus that any change in wages is mostly a result of variation in supply and demand. Sociologists, on the other hand, tend to assume that economic agents have fairly limited market information and therefore constantly seek guidance from institutions and the behaviors of their high-status peers.
Furthermore, sociologists emphasize that the decisions made by economic agents are co-determined by the pursuit of non-economic factors, including legitimacy, distinction, trust, social relationships, and morality. In addition, sociologists consider a much wider set of institutions when it comes to the issue of inequality. In addition to the common targets such as labor unions, minimum wage legislation, trade, and tax policies, an established body of sociological research examines the roles of criminal justice, neighborhood, social movements, corporate governance, and racial relationships in determining distributional outcomes.
Most likely, the weights of these two dynamics are variable across social contexts. The increasing popularity of intermediary websites like Elance could mean that, for certain segments of the labor market, the buyers and sellers of labor do have full access to the market information, and therefore supply and demand have a greater influence in determining the price of labor. In the meantime, it might be presumptuous to believe that a similar transparency exists across the whole labor market.
In the next post, I plan to explore in greater detail how different imaginations of market shape our thinking on inequality. In some ways the discourse of equality in India becomes almost impossible to imagine, precisely because thinking of an identity outside caste seemed always something of a conceptual impossibility. After , the British legitimised their rule not simply by reference to their own superiority, but also with the idea that the colonised societies were not considered nations at all. In response, the indigenous ruling elites needed to create a new basis for their own legitimacy, so they could be considered representatives of a nation.
But positing the existence of a nation, at the very least, required some proof that they drew their power from the people of this nation—which meant that the people needed to possess at least minimal political rights. So political equality was the easiest value to institutionalise, and found profound expression in the powerful political idioms of the Indian constitution. This constitutional framework was no mean achievement. It created a basic framework that made political equality an article of faith.
- American Economic Association.
- Advances in Quantum Chemistry: 51.
- It's time to totally change how we think about inequality.
Furthermore, the fact that BR Ambedkar played a prominent part in shaping it gave the Constitution even more legitimacy than any of the founders could have imagined. It is harder to mobilise a politics of equality in a society whose elites have just acquired the self-conception that they are egalitarian.
Back in the 18th century, Adam Smith had predicted that a democracy, the United States, would be among the last countries to abolish slavery, and it took a brutal civil war to bring that about. Almost no democracy has seriously expropriated the rich—and there is a case to be made that elites enthusiastically embraced democracy precisely because they recognised that the big fear it once induced, of the poor voting out the rich, proved to be largely groundless.
Democracy, in the Indian context, proved the surest way of keeping more radical and revolutionary forces at bay. The powerful quickly realised that far from dispossessing them, democracy would allow them to exercise power in new ways. It would take a long essay to describe why democracy has turned out to be a relatively conservative force. But it is fair to say that democracy served the interests of power more than it went against them.
The acknowledgment of the necessity of democracy was followed by claims for the functional necessity of equality in the modern world, on what we might call the grounds of efficiency. This idiom also had its genesis in the independence movement, as thinker after thinker came to the conclusion that the superiority of the West consisted largely in the capacity of its states to enlist the productive energies of the entirety of their populations.
Prosperity and power demanded enhanced productive capacity. But it no longer conformed to the functional requirements of modern society. The mode of organising society had to make a transition from hierarchy to equality because this was a functional necessity. This argument, first devised in the context of caste, could easily be extended to other categories like gender. Inclusion, as it were, became a desirable goal because it was necessary for growth. The attraction of this argument is not to be underestimated.
Our lack of human development, for instance, evokes less an ethical anxiety about inequality, and more a concern for national competitiveness. The problem is that this concern goes only so far as the elites perceive these things to be practically necessary. In spite of their limitations, these instrumentalist policies could have contributed to alleviating the spectre of human suffering if they had actually given citizens the means to participate in a modern economy. The state tried, and partly succeeded. But an odd mixture of the failure of democratic accountability, administrative myopia, and some startlingly obtuse policy choices made this project less credible, even on its own terms.
In some ways, the failure of the state exacerbated the trust deficit that is at the heart of the politics of inequality. Among the privileged, even those who would have been inclined to let the state take actions to increase equality recoiled at the prospect of a state that fed its own insatiable logic rather than achieving concrete outcomes. While the poor continued to regard the state as oppressive at worst, and at best an institution from which political ingenuity could extract small favours. While elites had their reasons to infuse equality with some content through their ideas of democracy and development, a more powerful impetus was given to the idea by the struggles of oppressed groups themselves, led by figures like Narayana Guru, Jyotirao Phule and Ambedkar.
If there has been anything revolutionary at all about social change in India, it is the transformation in the consciousness of hitherto marginalised groups like Dalits, who at every turn began to resist the chains of subordination. This is an undoing of inequality through acts of agency and resistance, a refusal to let social necessity determine the horizon of possibility. These social movements revolutionised the consciousness of oppressed groups, and produced a new sense of dignity and self-esteem that is behind so much of the new energy in India.
But in their current form there are inherent limitations to what they can achieve. In politics, many of these movements managed to displace existing power holders. But one consequence of this conception of equality is that it has placed an enormous burden on reservations as the instrument of equality. As a result, reservations based on anything other than an ascriptive criteria like caste are not seen as expressing a politics of equality. There are several reasons for this. For the reasons mentioned above, we do not have any instruments for the abolition of class.
To continue this line of thinking, let us consider the differences between how we understand caste mobility and class mobility. If a poor person becomes middle class, this is a positive development, and may reflect the fact that society has opened up avenues of opportunity. But this individual, by virtue of his mobility, is no longer poor—he is now middle class. They may have become rich or powerful, but their position on the axis of deprivation being measured in this case, caste does not change. This institutionalisation of caste as the basis of equality has some interesting consequences.
Caste has become the form in which the politics of social justice is expressed. While this point may sound banal, the way caste plays out in politics consistently obscures this fact. In India there is no serious discourse on the relationship between justice and discrimination. This is in part due to the fact that the category of discrimination was seen as specific to the Dalit experience. But it is also a result of the contemporary discourse of reservations, in which power-sharing rather than the absence of discrimination has become the central category in our thinking about justice.
Two further idioms of equality emerged from more traditional sources—or, more accurately, from attempts at their reinvention and reinvigoration. Much like the abolitionists who thought abolishing slavery was necessary to preserve the legitimacy of Christianity, these thinkers sensed that Indian tradition needed to be made more egalitarian if it was to survive. This was the current that went from Vivekanada to Gandhi, and it was quite honest in its appraisal of the depravity into which Indian social relations had fallen, though only Gandhi saw the degree of existential self-reformation real social reform would require.
For a time, this was arguably the big cultural project of modern India, but it ran aground for several reasons. First, because this project could not overcome the taint of being patronising. Ambedkar made that charge stick even to a figure like Gandhi, and it was a charge that became even more credible when the sole repositories of this tradition became groups like the RSS. Second, the project was premised on a renewed vitality in Indian thinking, but when Hindu reform hollowed out to the point where all that was left of it was an insecure nationalism, the whole project began to lose steam.
The final idiom in which equality has been framed in India came from a radical ethical vision, shared by an assortment of thinkers ranging from Vivekanada and Gandhi to the non-Marxist left. India has not produced many systematic tracts on equality—a revealing fact in its own light. But in the non-Marxist tradition from Gandhi to Ram Manohar Lohia, equality has been seen not in terms of political or social relations, but as related to the perfecting of the self.
To simplify somewhat, relations of inequality are produced largely because the individual self is not ordered in the right way. The root of inequality, in some form or the other, always lies in an exaltation of materialism, which compels us to seek domination over others. There is much that is acute in this kind of analysis, and it does focus attention on what kind of people we would have to be to practise egalitarian politics seriously. But as a means of achieving equality, it proved counter-productive, for it immediately tied the politics of equality to an idiom of renunciation.
As a cultural ideal, this had an enormous appeal—even now, there is a strong cultural association between the politics of egalitarianism and the politics of self-denial. Its great achievement was to create a certain embarrassment about wealth, or at least conspicuous consumption, and to induce a form of self-restraint that is now wearing thin.
- The Curse of the Blue Figurine (Johnny Dixon 01)!
- The Accidental Teacher: Life Lessons from My Silent Son;
- Inequality [What Think Tanks are thinking] - Think Tank!
- City Chic, 2E: The Modern Girls Guide to Living Large on Less.
- Wonks in Exile;
- Dictionary of Applied Math for Engineers and Scientists.
- All topics.
But the association of saintliness and the politics of equality made it an ideal few in the human species could practise. This ethical critique of the self could not provide a workable politics of equality for a nation committed to harnessing productive growth—and where the scourge of poverty made renunciation, paradoxically, seem like a luxury few could afford. The net result was that in Indian politics, the critique of inequality was so closely tied with a critique of materialism that it became identified with a glorification of poverty itself.
It did nothing to address the question of what an egalitarian politics appropriate to an economy committed to growth and expanding material well-being would look like. It was a Left-tinted politics of virtue, as it were, but it remained credible only insofar as its protagonists were virtuous.
Taken together, these five idioms have given content to our ideas of equality over the course of the past century. But as we have seen, each of them had its own considerable limitations. The idioms of democracy and development, which posited equality as a necessity for the attainment of other aims, advanced equality only to the extent that it served the imperatives of elite power.
The struggles of the oppressed transformed the consciousness of the victims of oppression, but then got stuck on a narrow measure of representation that reproduced the very identities the idea of equality was meant to overcome. The idea that the worst aspects of tradition could be transcended without making the whole tradition despicable proved to be a very fragile concept. And finally, the critique of material inequality turned out to be more a critique of materialism than of inequality. Equality always has a significant material dimension, and many would argue that the limitations of the idioms outlined above stem largely from their inability to confront the material aspect of inequality.
Indian Marxists would be the first to make this point, though they have not been the only ones to think about the material realities of inequality, as can be seen from the long list of struggles, past and present, over material issues like access to land, labour, forests, minerals, credit, capital and welfare.
But even here, old ways of thinking about material equality—like our exhausted idioms—have also become straitjackets, obstructing our ability to address new challenges. In part this is because growth has made our material identities more complex. The most prominent example of this new reality is the issue of land. In an overwhelmingly agrarian economy, the vision of an egalitarian utopia centred on land reform.
It was able to abolish zamindari, the most egregious form of land-based exploitation. But in many states, the whole structure of formal and informal rights that lay below the level of the zamindar was never decisively sorted out, producing an intense agrarian struggle. The issue of land has become central to conflicts in our society, whether in the case of tribals desperately trying to secure the rights to use their traditional lands, farmers contesting land acquisition, or disputes over urban zoning and development.
But while land remains an issue of great social contention, it is, with some exceptions, not the locus of an egalitarian politics. Land acquisition has also become a mechanism for deepening inequality in three distinct ways. First, property rights, which were weakened in India to facilitate land reform and help the poor, ironically ended up dispossessing them even more.
Third, while land acquisition often involves the promise of jobs in addition to monetary compensation, this too has done nothing to diminish inequality.
Get smart. Sign up for our email newsletter.
In most areas, there has been insufficient investment in providing skills to the dispossessed that would enable them to get meaningful jobs. Even when companies do hire local labour to perform menial work, this does nothing to shift the long-term trajectory of the affected communities. For all these reasons, land acquisition is often an occasion for reproducing existing inequalities rather than closing the gap.
If the politics over land have taken a new turn, the politics of taxation and welfare, as currently conceived, have also produced their own new pathologies. In some ways, these pathologies have to be understood against the backdrop of past failures in India.
This is not the occasion to debate the merits of the Nehruvian developmental model, and its interpretation by his successors. But it left a lasting institutional legacy that still marks the politics of equality. Each of these components produced their own pathologies. The result of irrational levels of taxation was not redistribution, but instead the creation of a black economy and a culture of avoidance that became second nature to Indian economic activity.
Partly as a backlash, there has been a greater rationalisation of the tax system during the past two decades. But it still rests largely on indirect rather than direct taxes, and it would stretch the imagination to argue that tax policy is now considered a locus of promoting equality. State control over private enterprise has, to a certain degree, been liberalised.
But in crucial areas like labour laws, these controls still remain. But these labour laws did have the unintended effect of fragmenting the power of labour. Insofar as they produced incentives for outsourcing, smaller units, and greater use of informal workers, they prevented the emergence of a full-blown labour movement.
Judged solely by the ratio between lockouts and strikes, the bargaining position of labour has progressively weakened over the past two decades. But whatever the case, these developments have radically diminished the significance of the workplace as a site for the politics of equality. The effects of centralisation have been more complex and subtle.
At the same time, the excessive centralisation of decision-making—which meant even minor decisions like teacher appointments or welfare distribution were not under local control—deprived ordinary citizens of a sense of agency, limiting their avenues for meaningful political participation. Participation of this sort is a key medium for the production of social equality, but even today the state consistently abridges these possibilities. This particular moment is a propitious one for rethinking the politics of social democracy.
Summer Schools on Socioeconomic Inequality
Whatever its other limitations, high growth provides an opportunity to build a state. There has also been a massive expansion in the provision of access to infrastructure like rural roads and telecommunications, a key component of increased inclusion. But it is important that these resources be applied to building the elements of genuine social democracy, rather than frittered away on populism.
But this historical opportunity is being threatened on all sides.
There is still a great deal of ideological resistance to recognising the potentially liberating effect of growth, and the real opportunities it affords even to the poor. It is fashionable to assert that there are two Indias, one on the fast track of growth, and the other still mired in stagnation. Indeed, much of our politics now centres on a new clamour for participation in the growth story—evident, to take just one example, in the exposition in demand for education at all levels. The danger here is that while there is a great deal of rhetorical handwringing over the growth of inequality, we are misunderstanding the nature of the challenge it poses.
But this approach links the politics of equality irrevocably to the politics of accountability. But the politics of accountability is a weak substitute for a politics of equality, in part because it fails to acknowledge how and why the capacity of the state has already been diminished. But the more substantial problem with the politics of accountability is that it pays little attention to what the state delivers. But the most important burden faced by the poor is often not resource deprivation. The irony of our current politics of equality is that while it has focused on the distribution of state resources, the state has been actively preventing citizens from becoming more productive participants in economic growth.
The next generation of conflicts will be less about distributive issues, defined along traditional class lines. They will be more about tearing down these barriers to participation. The brunt of this statism is often not borne by the rich, who can exit, but by the ordinary migrant looking to participate in a growing economy. The next generation of conflict will come precisely from these citizens, who are trying to wrest their rights of participation from a recalcitrant state.
The central question in an economy is the production of good jobs, and it is far from clear that India is on the kind of growth trajectory that could absorb its increasingly aspirational and educated workforce. This mismatch has not yet had immediate political effects, in part because longer schooling has slowed the rate of workforce expansion. Second, it is now becoming clearer that much of what we call liberalisation was directed towards the interests of big business, which got preference in everything from cheap credit to captive power. Access to credit is one key component of building a more egalitarian business environment, but state complicity ensured that big business mopped up most of that credit, often at the cost of small enterprise.
The politics of equality is at an impasse. The main ideological idioms in which it was conducted have been exhausted. And we are barely beginning to come to terms with the complexity of material conditions that affect equality. The politics of equality is now being aligned largely with a new idiom, that of accountability—which may be necessary to fix at least one piece of the equality problem, the misallocation of state resources in the name of promoting equality.
This could perhaps be one reason for some cautious optimism. Another reason to be optimistic is that growth, for all its limitations, has produced an immense churning. Under these circumstances, the old politics of economic equality—fixated on keeping rural India in its place, protecting small sections of labour rather than creating new opportunities, and focusing solely on welfare rather than the means of participation—will no longer be tenable. But the absence of growth will have catastrophic consequences for any project of equality, because new opportunities cannot be created without it.
Ultimately, a new politics of equality will require the imagination of a new idiom to replace those that have been exhausted—a new way to think about the reasons for equality without reference to its utility towards some other end. It will have to be based on reminding us of the good of equality, and the possibilities it affords for a new and better political community.
Is a globalized world a less equal world?
Centre Tricontinental. En Es Fr. The exhausted idioms of equality On the surface, Indian politics is defined by a concern with equality. Instruments of Change Equality always has a significant material dimension, and many would argue that the limitations of the idioms outlined above stem largely from their inability to confront the material aspect of inequality. Lire aussi George