Working Paper: CEPR ID: DP13342
Authors: David K. Miles
Abstract: How much of today's income (GDP) is a result of unjust economic transactions? How much is a legacy of past acquisition of wealth (capital) which was itself unjust? To answer that question requires two things: first, a principle to determine what is, and what is not, a just acquisition of wealth or a just source of income; second, a means of using that principle to estimate what fraction of wealth and income is unjust. I use a principle put forward by Robert Nozick to provide the first of these things and then use some calculations based on standard neoclassical models of economic growth to illustrate its implications for the scale of unfairness today.
Keywords: Distributive Justice; Solow Growth Model; Income Distribution; Human Capital
JEL Codes: O15; P14; P26; P48
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| unjustly acquired assets (P26) | current income distribution (E25) |
| unjustly acquired assets (P26) | current wealth distribution (D31) |
| nature of assets (G32) | half-life of economic injustice (D15) |
| saving behavior of individuals (D14) | half-life of economic injustice (D15) |
| unjust acquisitions from foreigners (H13) | half-life of injustice (P37) |
| unjust acquisitions within the same economy (P19) | half-life of injustice (P37) |
| unjust capital (P19) | persistent inequality (J70) |
| low savings from labor income (E25) | persistent inequality (J70) |