Amory Gethin - Research

Political Cleavages and Social Inequalities. A Study of Fifty Democracies, 1948–2020

Co-edited with Thomas Piketty and Clara Martínez-Toledano.

Harvard University Press, 2021. 656 pages.

Publications

Brahmin Left versus Merchant Right: Changing Political Cleavages in 21 Western Democracies, 1948-2020

Amory Gethin, Clara Martínez-Toledano, Thomas Piketty

Quarterly Journal of Economics, 2022. Editor’s choice. Appendix / Data

This article sheds new light on the long-run evolution of political cleavages in 21 Western democracies. We exploit a new database on the socioeconomic determinants of the vote, covering over 300 elections held between 1948 and 2020. In the 1950s and 1960s, the vote for social democratic, socialist, and affiliated parties was associated with lower-educated and low-income voters. It has gradually become associated with higher-educated voters, giving rise in the 2010s to a disconnection between the effects of income and education on the vote: higher-educated voters now vote for the “left,” while high-income voters continue to vote for the “right.” This transition has been accelerated by the rise of green and anti-immigration movements, whose distinctive feature is to concentrate the votes of the higher-educated and lower-educated electorates. Combining our database with historical data on political parties’ programs, we provide evidence that the reversal of the education cleavage is strongly linked to the emergence of a new “sociocultural” axis of political conflict.

Why is Europe More Equal than the United States?

Thomas Blanchet, Lucas Chancel, Amory Gethin

American Economic Journal: Applied Economics, 2022. Appendix

This article combines all available survey, income tax, and national accounts data to produce pretax and posttax income inequality series in twenty-six European countries from 1980 to 2017. Our estimates are consistent with macroeconomic growth rates and comparable with US distributional national accounts. Inequality grew in nearly all European countries, but much less than in the US. This rise was concentrated at the top end of the income distribution and was most pronounced in Eastern Europe. Contrary to a widespread view, we demonstrate that Europe’s lower inequality levels cannot be explained by more equalizing tax-and-transfer systems. After accounting for indirect taxes and in-kind transfers, the US redistributes a greater share of national income to low-income groups than any European country. “Predistribution”, not “redistribution”, explains why Europe is less unequal than the United States.

Wealth Inequality in South Africa, 1993-2017

Aroop Chatterjee, Léo Czajka, Amory Gethin

World Bank Economic Review, 2022. Appendix

This article estimates the distribution of personal wealth in South Africa by combining microdata covering the universe of income tax returns, household surveys, and macroeconomic balance sheet statistics. South Africa is characterized by unparalleled levels of wealth concentration. The top 10% own 86% of aggregate wealth and the top 0.1% close to one-third. The top 0.01% of the distribution (3,500 individuals) concentrate 15% of household net worth, more than the bottom 90% as a whole. Such levels of inequality can be accounted for in all forms of assets at the top end, including housing, pension funds, and financial assets. There has been no sign of decreasing inequality since the end of apartheid.

Income Inequality in Africa, 1990-2019: Measurement, Patterns, Determinants

Lucas Chancel, Denis Cogneau, Amory Gethin, Alix Myczkowski, Anne-Sophie Robilliard

World Development, 2022.

This article estimates the evolution of income inequality in Africa from 1990 to 2019 by combining surveys, tax data, and national accounts. Inequality in Africa is very high: the regional top 10% income share nears 55%, on par with regions characterized by extreme inequality, such as Latin America and India. Most of continent-wide income inequality comes from the within-country component rather than from average income differences between countries. Inequality is highest in Southern Africa and lowest in Northern and Western Africa. It remained fairly stable from 1990 to 2019, with the exception of Southern Africa, where it increased significantly. Among historical determinants, this geographical pattern seems to reveal the long shadow of settler colonialism, at least in Sub-Saharan Africa; the spread of Islam stands out as another robust correlate. The poor quality of the raw data calls for great caution, in particular when analyzing country-level dynamics.

Growing Cleavages in India? Evidence from the Changing Structure of Electorates, 1962-2014

Abhijit Banerjee, Amory Gethin, Thomas Piketty

Economic and Political Weekly, 2019. Working Paper & Appendix

This paper combines surveys, election results and social spending data to document a long-run evolution of political cleavages in India. The transition from a dominant-party system to a fragmented system characterized by several smaller regionalist parties and, more recently, the Bharatiya Janata Party, coincides with the rise of religious divisions and the persistence of strong caste-based cleavages. Education, income and occupation play a diminishing role (controlling for caste) in determining voters’ choices. There is no evidence of the new party system being associated with changes in social policy. This corroborates the fact that in India, as in many Western democracies, political conflicts are increasingly focused on identity and religious–ethnic conflicts rather than on tangible material benefits and class-based redistribution.

Working Papers

Public Services and Global Poverty Reduction

Draft available upon request.

This article constructs new estimates of global poverty that incorporate the consumption of public goods. Combining data from multiple sources, I build a novel historical database on the quality and progressivity of public services provided in 174 countries since 1980. Public goods are large and have considerably grown: they represent 30% of global GDP and have doubled in real value in the past four decades. The rise of public education and healthcare provision has been a major driver of inclusive growth. It accounts for at least 20% of global poverty reduction and 30% of the decline in global inequality of the past four decades. Poor countries continue nonetheless to suffer from a “triple curse” of providing public services in lower quantities, less progressively, and less efficiently than in the rich world, which considerably limits the incidence of public goods on global poverty. I outline proposals to include measures of public goods consumption in international poverty and inequality statistics.

Who Benefits from Public Goods? Evidence from South Africa

Draft available upon request.

This article provides new evidence on the distributional incidence of public goods. I combine newly digitized budget data with tax data, census microdata, and various surveys to estimate the distribution of all government transfers received by income group in South Africa from 1993 to 2019. My estimates account for changes in the progressivity of different types of policies and allocate all public services to individuals, including education, healthcare, police services, transport infrastructure, housing subsidies, and local government services. All categories of public spending are progressive (less concentrated than income), but with large variations. About 60% of education expenditure is received by the bottom 50%, compared to only 7% of spending on transport infrastructure. There has been a dramatic rise of redistribution since the end of apartheid: the share of national income redistributed to the poorest half of the South African population rose from 11% in 1993 to 18% in 2019. The bulk of this transformation was driven by public goods, which act as a major redistributive tool. In 2019, accounting for public services lifts the share of income received by the bottom 50% from only 6.5% to almost 15%. These findings highlight the critical role played by public services in enhancing inclusive growth in developing economies.

Can Redistribution Keep Up with Inequality? Evidence from South Africa, 1993-2019

Aroop Chatterjee, Léo Czajka, Amory Gethin

Can government redistributive policies successfully curb rising inequality and foster inclusive growth in emerging economies? This paper sheds new light on this question by combining survey, tax, and historical administrative data to measure the incidence of taxes and transfers on the distribution of growth in South Africa since the end of the apartheid regime. Our new database is fully consistent with macroeconomic totals reported in the national accounts and allocates the entirety of government revenue and expenditure to individuals, including indirect taxes and in-kind transfers. We document a dramatic divergence in the growth of top and bottom income groups: between 1993 and 2019, the pretax income of the top 1% rose by 50%, while that of the poorest 50% fell by a third. However, the widening of pretax income gaps has been almost fully compensated by the growing size and progressivity of the tax-and-transfer system, effectively mirroring a “chase between rising inequality and enhanced redistribution”. The decline of racial inequalities since the end of apartheid has been entirely driven by the boom of top Black income groups, which is only marginally reduced by taxes and transfers. Our results have important implications for fiscal policy, the measurement of poverty, and the analysis of the link between inequality and growth.

Work in Progress

Social Movements and Public Opinion (with Vincent Pons)

Global Posttax Income Inequality (with Carmen Durrer de la Sota & Matthew Fisher-Post)

Racial Inequality in South Africa, 1913-2019 (with Léo Czajka)

Inflation and Political Preferences (with Clara Martínez-Toledano and José-Luis Peydro)

Social Bases of Redistribution in India (with Poulomi Chakrabarti)

The Correlations of Inequality (with Morten Nyborg Støstad)

Disentangling the Dynamics of Political Change in Western Democracies

Book Chapters

Introduction. Objectives and Organization of the Book

Amory Gethin, Clara Martínez-Toledano, Thomas Piketty

in A. Gethin, C. Martínez-Toledano, T. Piketty (ed.), Political Cleavages and Social Inequalities, 2021.

Political Cleavages and Social Inequalities in 50 Democracies, 1948-2020

Amory Gethin, Clara Martínez-Toledano, Thomas Piketty