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The Injustice of Inequality

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Author Info
Edward L. Glaeser
Jose Scheinkman
Andrei Shleifer

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Abstract

In many countries, the operation of legal, political and regulatory institutions is subverted by the wealthy and the politically powerful for their own benefit. This subversion takes the form of corruption, intimidation, and other forms of influence. We present a model of such institutional subversion – focusing specifically on courts – and of the effects of inequality in economic and political resources on the magnitude of subversion. We then use the model to analyze the consequences of institutional subversion for the law and order environment in the country, as well as for capital accumulation and growth. We illustrate the model with historical evidence from Gilded Age United States and the transition economies of the 1990s. We also present some cross-country evidence consistent with the basic prediction of the model.

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Paper provided by Harvard - Institute of Economic Research in its series Harvard Institute of Economic Research Working Papers with number 1967.

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Date of creation: 2002
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Handle: RePEc:fth:harver:1967

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  1. Edward L. Glaeser & Andrei Shleifer, 2002. "The Curley Effect," Harvard Institute of Economic Research Working Papers 1956, Harvard - Institute of Economic Research. [Downloadable!]
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  2. Rudiger Dornbusch & Sebastian Edwards, 1991. "Macroeconomic Populism in Latin America," NBER Working Papers 2986, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  3. Kevin M. Murphy & Andrei Shleifer & Robert Vishny, 1988. "Income Distribution, Market Size, and Industrialization," NBER Working Papers 2709, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  4. Roland Benabou, 2002. "Tax and Education Policy in a Heterogeneous-Agent Economy: What Levels of Redistribution Maximize Growth and Efficiency?," Econometrica, Econometric Society, vol. 70(2), pages 481-517, March. [Downloadable!] (restricted)
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  5. Dornbusch, Rudiger & Edwards, Sebastian, 1989. "The macroeconomics of populism in Latin America," Policy Research Working Paper Series 316, The World Bank. [Downloadable!]
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  6. Simeon Djankov & Rafael La Porta & Florencio Lopez-de-Silane & Andrei Shleifer, 2002. "Courts: the Lex Mundi Project," NBER Working Papers 8890, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  7. Robert J. Barro, 1991. "Economic Growth in a Cross Section of Countries," NBER Working Papers 3120, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  8. Waldmann, Robert J, 1992. "Income Distribution and Infant Mortality," The Quarterly Journal of Economics, MIT Press, vol. 107(4), pages 1283-302, November. [Downloadable!] (restricted)
  9. Edward L. Glaeser, 2001. "Public Ownership in the American City," Harvard Institute of Economic Research Working Papers 1930, Harvard - Institute of Economic Research. [Downloadable!]
  10. Edward L. Glaeser, 2001. "Public Ownership in the American City," NBER Working Papers 8613, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  11. repec:fth:coluec:595 is not listed on IDEAS
  12. George J. Stigler, 1971. "The Theory of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 2(1), pages 3-21, Spring. [Downloadable!] (restricted)
  13. Bénabou, Roland, 1996. "Inequality and Growth," CEPR Discussion Papers 1450, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  14. Barro, Robert J, 1996. " Democracy and Growth," Journal of Economic Growth, Springer, vol. 1(1), pages 1-27, March.
  15. Deininger, Klaus & Squire, Lyn, 1996. "A New Data Set Measuring Income Inequality," World Bank Economic Review, Oxford University Press, vol. 10(3), pages 565-91, September.
  16. Sonin, Konstantin, 1999. "Inequality, Property Rights Protection, and Economic Growth in Transition Economies: Theory and Russian Evidence," CEPR Discussion Papers 2300, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  17. Lindert, Peter H. & Williamson, Jeffrey G., 1985. "Growth, equality, and history," Explorations in Economic History, Elsevier, vol. 22(4), pages 341-377, October. [Downloadable!] (restricted)
  18. Fajnzylber, Pablo & Lederman, Daniel & Loayza, Norman, 2002. "Inequality and Violent Crime," Journal of Law & Economics, University of Chicago Press, vol. 45(1), pages 1-40, April.
  19. Lindert, Peter H., 2000. "Three centuries of inequality in Britain and America," Handbook of Income Distribution, in: A.B. Atkinson & F. Bourguignon (ed.), Handbook of Income Distribution, edition 1, volume 1, chapter 3, pages 167-216 Elsevier. [Downloadable!] (restricted)
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  20. Benabou, R., 1996. "Unequal Societies," Working Papers 96-17, C.V. Starr Center for Applied Economics, New York University. [Downloadable!]
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  21. Edward Glaeser & Simon Johnson & Andrei Shleifer, 2001. "Coase Versus The Coasians," The Quarterly Journal of Economics, MIT Press, vol. 116(3), pages 853-899, August. [Downloadable!] (restricted)
  22. Daron Acemoglu & James A. Robinson, 2002. "Economic Backwardness in Political Perspective," NBER Working Papers 8831, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  23. Persson, Torsten & Tabellini, Guido, 1994. "Is Inequality Harmful for Growth?," American Economic Review, American Economic Association, vol. 84(3), pages 600-621, June. [Downloadable!] (restricted)
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  24. Edward L. Glaeser & Andrei Shleifer, 2003. "The Rise of the Regulatory State," Journal of Economic Literature, American Economic Association, vol. 41(2), pages 401-425, June.
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  25. Banerjee, Abhijit V & Newman, Andrew F, 1993. "Occupational Choice and the Process of Development," Journal of Political Economy, University of Chicago Press, vol. 101(2), pages 274-98, April. [Downloadable!] (restricted)
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  26. Lewis, Donald E, 1985. "The," The Economic Record, The Economic Society of Australia, vol. 61(175), pages 719-36, December.
  27. La Porta, Rafael & Lopez-de-Silanes, Florencio & Shleifer, Andrei & Vishny, Robert, 2000. "Investor protection and corporate governance," Journal of Financial Economics, Elsevier, vol. 58(1-2), pages 3-27. [Downloadable!] (restricted)
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