1. The question of inequality Donald Hay, Jesus College and Department of Economics, Oxford DCM Social Sciences stream, March 20 th and 21 st 2015

2. 1.Growth of inequality (Piketty) 2.Explanations (Piketty, Stiglitz) 3.Consequences of inequality (Wilkinson and Pickett) 4.Theological perspectives on inequality 5.Biblical ethics from the OT: economic justice, and justice for the poor Outline of talk

3.  Focus on growth of inequality of income and wealth in many of the rich economies since 1970 Other inequalities: - gender, e.g. at work - race, e.g. questions about policing - sexual orientation, e.g. campaigns for gay ‘marriage’ - religious, e.g. minorities in Middle East and India Types of inequality

4.  Variations across OECD countries in ratio of income of top 20% to bottom 20% [next slide] Income inequality: international comparisons

6.  Evolution of income inequality in US and UK since the beginning of the 20 th Century (Piketty): the share of the top 1% The evolution of income inequality

8. Piketty, Capital in the Twenty First Century  Wealth inequality in Europe and the US since the 19 th century  Top wealth holders in the world economy The evolution of wealth inequality

10. Top wealth holders in the world economy:  Oxfam report: the number of top wealth holders in the world who have as much wealth as the bottom 50% was 388 in 2010, falling to 80 in 2014  The increasing share of top wealth holders since 1987 according to Piketty. The evolution of wealth inequality

12. Piketty – the inexorable consequence of market capitalism: - the ratio of capital to income (see next slide) - the share of capital in national income - r>g - the role of inheritance in accumulation - critiques Explanations for growth in inequality (1)

14. Political economy arguments (Stiglitz) - in US at least inequality is outcome of rent-seeking behaviour of wealthy elites:  Government action favouring corporations and the wealthy  Actions by wealthy to protect their wealth: lobbying Congress, capturing regulators, media campaigns  Electoral manipulation Explanations for growth in inequality (2)

15.  The correlation of inequality and social indicators across rich countries (see slide 17)  Social indicators: level of trust, incidence of mental illness and addiction, life expectancy, obesity, student scores in maths and literacy at age 15, birth rates among teenage girls, homicides and violent assaults, prisoners per 100000 population, social mobility Consequences of inequality

16. Summary:  Social indicators 3x to 10x worse in most unequal countries than in most equal countries  Prevalence of social problems affects whole income distribution, not just the poorest groups  Greater equality can be result of earnings equality (Japan) or redistribution (Sweden) Explanations? Consequences of inequality (continued)

18. What is wrong with inequality?  Is inequality is just how things are?  Should we be concerned about the 1%?  Is the issue poverty not inequality per se?  Does it matter if inequality is associated with social dysfunction? Are there ethical concerns about the processes by which inequality comes about?  For example, the exercise of power by wealthy elites to safeguard their wealth and income? Ethical questions posed by inequality

19.  Creation: Imago Dei, relational, the neighbour  The people of God: equality in the community of the people of God  Principle of solidarity  Principle of the common good Theological approaches

20. Applications:  Inequality contravenes principle of solidarity – implies that some members of the community are worth less than others, and creates relationships of power between people.  Inequality arising from exercise of power and influence by elites is not conducive to the common good. Theological approaches

21. Leviticus 25: the allocation of the land in Ancient Israel - three key elements:  The Land as God’s gift, v23  The initial distribution of the Land: Numbers 26  Loss of land, the Jubilee provisions, and stipulations for the interim until the Jubilee Biblical insights (1): Economic justice

22. Principles underlying the arrangements for the Land:  Equality of opportunities to work and access to resources  Work and the ability to provide for one’s household available to everyone  Systemic mechanisms to redress inequalities that develop over time

23. Poverty in the OT:  Most frequently linked to oppression  Main bulwark against poverty was family land, so problem if family had lost its land, or had no inheritance  Family experiencing crop failure or loss of livestock to disease Biblical insights (2): justice for the poor

24. Provisions to address problems of poverty:  Triennial tithe, Deuteronomy 14: 28,29  Gleaning laws, Deuteronomy 24: 19  Interest free loans, Leviticus 25, a form of mutual insurance

25. Principles for poverty alleviation:  Systems of mutual support – triennial tithe, gleaning laws  Loans may be appropriate if poor person is expected to be able to recover economically, but debts should not be allowed to accumulate  Systems are local, to avoid problems of moral hazard  Mutual support characterised by equality (compare 2 Corinthians 8 and 9, especially 8: 13, 14)

26. Questions that need to be addressed:  Should we be concerned about inequality whatever form it takes?  Should we be concerned about inequality in wealth and income per se?  Should we be concerned about the apparent growth in inequality, and the processes that are driving that growth?  Are there specifically Christian ethical principles that help us to address these issues? Conclusions