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Inequality persistence through vertical vs. horizontal coalitions

  • Pellicer, Miquel

This paper aims to contribute to a better understanding of the observed high persistence of cross-country differences in inequality. It focuses on the interactions between inequality and the predominance of either horizontal coalitions (among individuals of similar economic status) or vertical ones (among individuals with different economic status). A model is proposed showing that the interactions between inequality and the type of coalition formed in a society can give rise to self-sustained social contracts where inequality persists. Key mechanisms of the model are illustrated using the transformation in inequality, redistribution and social relations in Modern England, as well as the "paternalist" system of the US South at the beginning of the XXth century.

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Article provided by Elsevier in its journal Journal of Development Economics.

Volume (Year): 90 (2009)
Issue (Month): 2 (November)
Pages: 258-266

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Handle: RePEc:eee:deveco:v:90:y:2009:i:2:p:258-266
Contact details of provider: Web page: http://www.elsevier.com/locate/devec

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  1. International Monetary Fund, 2003. "Income Inequality and Redistributive Government Spending," IMF Working Papers 03/14, International Monetary Fund.
  2. Peter H. Lindert, . "Three Centuries Of Inequality In Britain And America," Department of Economics 97-09, California Davis - Department of Economics.
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  4. Stanley L. Engerman & Kenneth Lee Sokoloff, 2002. "Factor Endowments, Inequality, and Paths of Development among New World Economies," JOURNAL OF LACEA ECONOMIA, LACEA - LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION.
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  17. Meltzer, Allan H & Richard, Scott F, 1981. "A Rational Theory of the Size of Government," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 914-27, October.
  18. Thomas Piketty, 2005. "Top Income Shares in the Long Run: An Overview," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 382-392, 04/05.
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