Equality runs deeper than preference or policy fashion, rooted in human social instincts and reflected in outcomes across societies. It is time for economics and policy alike to reckon with how profoundly distribution shapes well-being and social stability.
Research in biology and anthropology shows that humans evolved in largely egalitarian small groups; occasional selfishness was punished. Aversion to inequality is thus an inherited human characteristic. In unequal societies, humans experience stress, leading to many social pathologies, as shown by extensive literature in epidemiology. Well-being can be increased by reducing inequality, independent of increases in GDP. This is obscured by current economic theories, which use unrealistic assumptions and an empirically completely unsupported “equity-efficiency tradeoff” to justify ignoring distribution. Finally, we show that public policy can have an enormous impact on income inequality and has done so in the past.
