Group Inequality

Samuel Bowles (), Glenn Loury and Rajiv Sethi ()
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Samuel Bowles: Santa Fe Institute and University of Siena

No 88, Economics Working Papers from Institute for Advanced Study, School of Social Science

Abstract: This paper explores conditions under which inequality across social groups can emerge from initially group-egalitarian distributions and persist across generations despite equality of eco- nomic opportunity. These conditions arise from interactions among three factors: the extent of segregation in social networks, the strength of interpersonal spillovers in human capital accumu- lation, and the responsiveness of relative wages to the skill composition in production. Social segregation is critical in generating these results: group inequality cannot emerge or persist un- der conditions of equal opportunity unless segregation su¢ ciently great. We also show that if an initially disadvantaged group is su¢ ciently small, integration above a threshold level can induce both groups to invest more in human capital, while the opposite holds if the disadvantaged group is large.

Keywords: segregation; networks; group inequality; human capital (search for similar items in EconPapers)
JEL-codes: D31 J71 Z13 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2009-02
New Economics Papers: this item is included in nep-hrm, nep-ltv, nep-pke, nep-soc and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (20)

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Related works:
Journal Article: GROUP INEQUALITY (2014)
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