Economic dynamics of equality and classes

• Main Author: Veneziani, Roberto
• Published: London School of Economics and Political Science (University of London) 2005
• Subjects: 320.011
• Online Access: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.421886

This dissertation analyses the dynamics of inequality and classes, from a positive and a normative viewpoint, focusing on two distinct, but related approaches - Analytical Marxism and the theory of equality of opportunity, - which raise significant philosophical, economic, and political issues. The importance of a dynamic perspective in the analysis of normative theories is emphasised as an essential tool in the process of theoretical construction. Indeed, this dissertation analyses some important anomalies of egalitarian and Marxian theories that arise in the dynamic context and suggest to reconsider our established views on inequality and classes. First, the proper temporal unit of egalitarian (or Marxian) concern must be defined: agents' whole lives or selected parts of them. Egalitarian principles based on different units incorporate different normative concerns, both in the analysis of existing inequalities and, unlike in the static setting, in the definition of the egalitarian benchmark. No principle seems entirely satisfactory in the analysis of unequal distributions, but corresponding segments egalitarianism defines the appropriate intertemporal egalitarian benchmark. Second, egalitarian theorists, since Rawls, have in the main advocated equalising some objective measure of individual well-being, rather than subjective welfare. This discussion, however, has assumed, implicitly, a static environment. In a dynamic context, equality of opportunity for some objective condition is incompatible with human development over time. This incompatibility can be resolved by equalizing opportunities for welfare. Thus, 'subjectivism' seems necessary to obtain both equality of opportunities and the development of human capacity. Finally, the modern theory of exploitation emphasises asset inequalities as the fundamental injustice of competitive economies. However, in dynamic equilibria with persistent asset inequalities and capital scarcity, exploitation tends to disappear. Asset inequality is therefore a normatively secondary (though causally primary) wrong. The analysis of the dynamic economy also raises doubts on the possibility of providing robust micro-foundations to Marxian concepts by means of Walrasian models.