NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Inequality

Edward L. Glaeser

NBER Working Paper No. 11511
Issued in August 2005
NBER Program(s):   PE

This paper reviews five striking facts about inequality across countries. As Kuznets (1955) famously

first documented, inequality first rises and then falls with income. More unequal societies are much

less likely to have democracies or governments that respect property rights. Unequal societies have

less redistribution, and we have little idea whether this relationship is caused by redistribution

reducing inequality or inequality reducing redistribution. Inequality and ethnic heterogeneity are

highly correlated, either because of differences in educational heritages across ethnicities or because

ethnic heterogeneity reduces redistribution. Finally, there is much more inequality and less

redistribution in the U.S. than in most other developed nations.

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Document Object Identifier (DOI): 10.3386/w11511

Published: Fullerton, D. and B. Weingast (eds.) The Oxford Handbook of Political Economy. New York: Oxford University Press, 2006.

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