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The Secular Trend Of Income Inequality, 1870-2000: Theoretical And Historical Perspectives

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Chapter Summary

This chapter takes up the main premise of this book, namely that the nature of economic development, rather than the rate of economic growth, determines the secular trend of income inequality. It evaluates various theoretical perspectives on long run distributional change, and discusses theories of distributional change against the background of specific Latin American initial conditions and historical circumstances. The chapter first addresses the hypothetical effects of globalisation on distributional change, concentrating on a discussion of the predictions of the Hecksher-Ohlin-Samuelson model. Next, it discusses the hypothetical effects of structural and technological change on distributional change, focusing on the Kuznets curve hypothesis and the theory of skill-biased technical change. Finally, it addresses the hypothetical effects of institutional change on distributional change, especially focusing on the evolution of labour movements and changes in socio-economic policies from a collective action theory perspective.

Keywords: collective action theory; distributional change; Hecksher-Ohlin-Samuelson model; income inequality; institutional change; Kuznets curve hypothesis; labour movements; Latin America



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