Working Paper: NBER ID: w28387
Authors: Emmanuel Saez
Abstract: This paper argues that the social nature of humans, absent from the standard economic model, is crucial to understand our large modern social states and why concerns about inequality are so pervasive. A social solution arises when a situation is resolved at the group level (rather than the individual level) through cooperation and fair distribution of the resulting surplus. In human societies, childcare and education for the young, retirement benefits for the old, health care for the sick, and income support for those in need, is resolved at the social level, and through the social state in advanced economies. Social situations are pervasive even outside government and play a significant role in the distribution of pre-tax market incomes.
Keywords: Public Economics; Inequality; Social Nature; Government Intervention
JEL Codes: H0
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| human cooperation (P13) | social solutions (O35) |
| social solutions (O35) | government interventions (H53) |
| government interventions (H53) | reduced inequality (I14) |
| size of government (H11) | income distribution (D31) |
| higher taxes and transfers (H29) | reduced inequality (I14) |
| government structures in U.S. and France (H19) | different trajectories in income inequality (D31) |
| social nature of humans (Z13) | demand for government policies (J18) |
| social nature of humans (Z13) | effectiveness of government policies (F68) |