Contending Perspectives in Economics: The Case of Inequality

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In recent years, the issue of rising inequality has dominated the media. People’s views on inequality are shaped by their perception of the world. Economists are no different. In this course, we will discuss various perspectives in economics such as Neoclassical, Austrian, Marxism, Post Keynesian, (New) Institutionalism and Feminist Economics. We will both focus on these perspectives within the field of economics as a scientific discipline, and on how these perspectives differ in their view on inequality. According to some scholars, inequality is a natural phenomenon in a capitalist market economy. It is a fair reward for higher education and training. Some other scholars disagree with this view. They observe that the sharpest inequality stems from other sources than education, and it is not justified by individual merits alone. Further, they emphasize that inequality in itself has detrimental effects on societies and therefore it should be prevented as much as possible. Finally, some economists see inequality as the result of economic growth and therefore conclude that increases in societal wealth cannot be attained without inequality. In this course, we will firstly discuss the main elements within each school of thought, how they emerged and how they differ from each other. Secondly, we accompany these discussions with their view and interpretation of inequality. We discuss various perspectives in which inequality can be regarded such as the distribution of income amongst capitalist versus workers, income inequality between various groups in society and the difference between inequality in income versus inequality in wealth. How can we explain differences in society and are these differences persistent? Thirdly, we also touch upon different measures of inequality by using actual data and applying some (simple) indicators. This all will be discussed in tutorial meetings and students will work on (group) papers. We will present and discuss these papers for which we also include peer feedback