Sunday 20 October, 5.15pm until 6.15pm, Conservatory Economic solutions?
‘Inequality is the defining issue of our time’, said US president Barack Obama in 2012 – an especially significant judgement following years of economic malaise. A year later, the head of the IMF, Christine Lagarde, continued the theme: ‘Excessive inequality is corrosive to growth; it is corrosive to society… the economics profession and the policy community have downplayed inequality for too long.’ British politicians seem to agree. Prime minister David Cameron has delivered various speeches on the dangers of inequality while Labour leader Ed Miliband has pledged to fight it, too. But is the fight against inequality really the unequivocally good fight many present it as today?
There certainly seems to be a widely held conviction that inequality is bad for society: it creates envy; it fosters resentment; and ultimately, it leads to social unrest. But is this true? Moreover, is there something to be said for inequality? Would a society in which markets and individuals are freer, a society in which inequalities are therefore inevitable, allow wealth creation to flourish? Should we in fact be encouraging competition rather than enforcing equality?
Others argue that the focus on combatting inequality actually damages the lives of the less well-off. That is, the prioritisation of the re-distribution of existing wealth and earnings over a focus on the creation of new wealth, means that we will all be poorer in the long run. But is this true? Does the focus on shifting around existing wealth detract from attempts to grow the economy as a whole, and increase wealth in general? Indeed, does the elevation of inequality as the defining issue of our time indicate that Western politicians are not only incapable of creating a wealthier society, but even of making a case for one?
Professor Danny Dorling
The Halford Mackinder Professor of Geography, University of Oxford
CEO, Clerkswell; author, The UK After The Recession
professorial research fellow, Civitas; professor emeritus, University of Sussex; distinguished fellow, Centre for Independent Studies, Australia
Merryn Somerset Webb
freelance journalist; author, Stand By Your Manhood
Rodriguez argues that there is no evidence that inequality encourages growth and describes the negative impacts that inequality has on politics and the economy.Francisco Rodríguez C., World Bank, 2013
British parties that take comfort in tired attitudes will be dumped.Janan Ganesh, FInancial Times, 11 April 2013
Riches are concentrated in the hands of the fewMerryn Somerset Webb, Financial Times, 8 March 2013
Vance Ginn debunks several popular myths about the effects of income inequality and argues that focusing on income inequality distracts from the real, important economic problems facing American society.Vance Ginn, Policy Mic, February 2013
Using a study of 48 U.S. states, Hasanov and Izraeli found that there is an optimum level of inequality that encourages growth, and too much or too little could decrease growth.Fuad Hasanov & Oded Izraeli, Harvard Business Review, 1 January 2012
This chapter identifies inequality patterns across OECD countries and provides new analysis of their policy and non-policy drivers.Organisation for Economic Co-operation and Development,