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Should-Read: Branko Milanovic: Reducing inequality by deconcentrating capital

Summary:
Should-Read: Branko Milanovic is what Marx used to call a petty-bourgeois socialist: tame capitalism by making sure that valuable property is widely distributed. Marx thought that this was doomed to fail under industrial capitalism, but Marx’s arguments have big holes in them. It might well work: Branko Milanovic: Reducing inequality by deconcentrating capital: “The capital–income ratio continues to rise… http://voxeu.org/article/reducing-inequality-deconcentrating-capital …This increases interpersonal inequality when three conditions are met (as they are in all rich economies today): the rate of return to capital outstrips that of income, income from capital is concentrated among the rich, and the income source that is less equally distributed is correlated with overall income.

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Should-Read: Branko Milanovic is what Marx used to call a petty-bourgeois socialist: tame capitalism by making sure that valuable property is widely distributed. Marx thought that this was doomed to fail under industrial capitalism, but Marx’s arguments have big holes in them. It might well work:

Branko Milanovic: Reducing inequality by deconcentrating capital: “The capital–income ratio continues to rise… http://voxeu.org/article/reducing-inequality-deconcentrating-capital

…This increases interpersonal inequality when three conditions are met (as they are in all rich economies today): the rate of return to capital outstrips that of income, income from capital is concentrated among the rich, and the income source that is less equally distributed is correlated with overall income. This column argues that the third condition is not inevitable, and that policies to share income from capital more equally would decrease overall inequality. We have tools to do this, but policymakers lack the political will…

Bradford DeLong
J. Bradford DeLong is Professor of Economics at the University of California at Berkeley and a research associate at the National Bureau of Economic Research. He was Deputy Assistant US Treasury Secretary during the Clinton Administration, where he was heavily involved in budget and trade negotiations. His role in designing the bailout of Mexico during the 1994 peso crisis placed him at the forefront of Latin America’s transformation into a region of open economies, and cemented his stature as a leading voice in economic-policy debates.

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