Working Paper: CEPR ID: DP6330
Authors: Indraneel Dasgupta; Ravi Kanbur
Abstract: We investigate how vertical unity within a community interacts with horizontal class divisions of an unequal income distribution. Community is conceptualized in terms of a public good to which all those in the community have equal access, but from which outsiders are excluded. We formulate the idea of redistributive tension, or class antagonism, in terms of the costs that poorer individuals would be willing to impose on the rich, to achieve a given gain in personal income. Our conclusion is that the nominal distribution of income could give a misleading picture of tensions in society, both within and across communities. Ideologies of community solidarity may well trump those of class solidarity because of the implicit sharing of community resources brought about by community-specific public goods. Greater economic mobility of particular types may actually exacerbate class tensions instead of attenuating them. We illustrate our theoretical results with a discussion of a number of historical episodes of shifting class tensions and alliances.
Keywords: class conflict; community; distribution; ethnic conflict; inequality; public goods
JEL Codes: D31; D63; D74; Z13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| vertical unity within communities (N90) | reduction in demand for income redistribution among poorer individuals (H31) |
| provision of community-specific public goods by wealthier individuals (H49) | stabilization of income inequality (D31) |
| increase in income of the rich (D31) | increase in public goods available to the community (H49) |
| increase in public goods available to the community (H49) | greater willingness among poorer individuals to impose higher costs on the rich for redistributive policies (H39) |
| community dynamics (Z13) | influence on class antagonism (B24) |