Friday, November 13, 2009

3 denials of inequality

Neoclassical economists don’t focus on inequality, in their teaching and research. But they’ve been forced to confront the problem because of the data compiled by Thomas Piketty and Emmanuel Saez documenting a persistent and growing inequality in the distribution of income in the United States (not to mention the general discontent about CEO salaries, government bail-outs of banks that are “too big to fail,” the problems of health care coverage, and much else).

The response of neoclassical economists has been to deny the existence of a problem, by arguing:

  1. inequality doesn’t exist (Alan Reynolds)
  2. inequality hasn’t increased by as much as people think (Scott Winship)
  3. even if inequality has been growing, it’s not the real problem (Will Wilkinson)

Still, the problem of inequality is not going away, nor are its consequences. . .

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