Global inequality and global macroeconomics

To link to full-text access for this article, visit this link: http://dx.doi.org/10.1016/j.jpolmod.2007.05.008 Byline: James K. Galbraith Keywords: Inequality; Macroeconomic forces; Globalization; Development; Kuznets; Inverted 'U' hypothesis Abstract: This paper presents evidence for a common global pattern in the movement of inequality in national structures of pay, over the years 1963 to 1999. We find a worldwide pattern of declining inequality from 1971 until 1980, followed by a long and sharp period of increasing inequality from 1981 through the end of the century. The existence of a global pattern suggests that the study of inequality, long associated with the disparate effects of technology, trade in local or national labor markets and with national policy choices, would be better treated as a branch of a global macroeconomics, associated with the breakdown of Bretton Woods in 1971-73 and with the onset of the global debt crisis in 1981-82. The work is based on data sets developed by the University of Texas Inequality Project. Author Affiliation: LBJ School of Public Affairs, The University of Texas at Austin, Austin, TX 78713-8925, USA Article History: Received 1 August 2006; Revised 1 February 2007; Accepted 1 April 2007 Article Note: (footnote) [star] Reprinted with permission from David Held and Ayse Kaya (Eds.), Global Inequality, Ralph Miliband Lecture Series on Inequalities at the London School of Economics. Cambridge: Polity Press, 2007, 148-175.