The Political Economy of Inequality and Redistribution

The literature on the politics of inequality and redistribution in advanced democracies has become very large in recent years. This article focuses on several areas where important new arguments are being put forward. It reviews recent work on the interaction of unions and employers, the role of political parties and electoral institutions, and the effects of racial and religious diversity. It also discusses the implications of recent work in behavioural economics and political science that helps us to understand cross-national variation in political responses to inequality. It highlights the distinctive contributions of several 'schools' of research, and identifies linkages across different analytical approaches.