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Pre-Industrial Inequality

Authors


  •  Corresponding author: Branko Milanovic, World Bank, 1818 H Street N.W., Washington D.C. 20433; E-mail: bmilanovic@worldbank.org.

  • We acknowledge help with the data from Ken Andrien, Carlos Bazdresch, Luis Bértola, Arne Bigsten, Maristella Botticini, Gwyn Cambell, David Clingingsmith, Metin Coşgel, Gustavo Delangel, Rafa Dobado González, Regina Grafe, Jan Luiten van Zanden, Paolo Malanima, Leandro Prados de la Escosura, Pierre van der Eng, Jim Roumasset, Jaime Salgado and Javier Rodriguez Weber. Without their generous help the article would have been impossible. The article has also been improved by the comments of participants at various meetings where it was presented: EHA (September 2007), CIDE (October 2007), Carlos III (December 2007), World Bank (February 2008), Canterbury (March 2008), Australian National University (April 2008), Monash (May 2008), Warwick (May 2008), Paris School of Economics (July 2008), Center for Global Development (September 2008), IISH (October 2008), Wisconsin (October 2008), and the Santa Fe Institute (March 2009). We are also grateful for comments to the editor of this Journal, Antonio Ciccone, and two anonymous reviewers as well as to Mihail Arandarenko, Francisco Ferreira, Andrew Leigh, Jaime Pozuelo-Monfort, Martin Ravallion and Walter Scheidel. Lindert and Williamson acknowledge financial support from the National Science Foundation (SES-0433358 and SES-0001362) and, for Williamson, the Harvard Faculty of Arts and Sciences.

Abstract

Is inequality largely the result of the Industrial Revolution? Or, were pre-industrial incomes as unequal as they are today? This article infers inequality across individuals within each of the 28 pre-industrial societies, for which data were available, using what are known as social tables. It applies two new concepts: the inequality possibility frontier and the inequality extraction ratio. They compare the observed income inequality to the maximum feasible inequality that, at a given level of income, might have been ‘extracted’ by those in power. The results give new insights into the connection between inequality and economic development in the very long run.

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