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Does Inequality lead to Conflict?

Indranil Dutta and Ajit Mishra

Working Papers from eSocialSciences

Abstract: This paper presents a simple model to show how distributional concerns can engender social conflict. They have a two period model, where the cost of conflict is endogenous in the sense that parties involved have full control over how much conflict they can create. We find that anticipated future inequality plays a crucial role in determining the level of conflict in the current period. The model also provides an explanation for why similar levels of inequality may exhibit drastically different levels of conflict. Further, they argue that the link between inequality and conflict may be non-monotonic. [Research Paper No. 2005/34]

Keywords: conflict; wealth inequality; Nash bargaining (search for similar items in EconPapers)
Date: 2010-12
New Economics Papers: this item is included in nep-ltv and nep-mic
Note: Institutional Papers
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