Inequality and Redistribution: Evidence from U.S. Counties and States, 1890-1930

61 Pages Posted: 20 Jan 2009 Last revised: 31 Jan 2009

See all articles by Rodney Ramcharan

Rodney Ramcharan

University of Southern California, Marshall School of Business

Date Written: January 12, 2009

Abstract

Does economic inequality affect redistributive policy? This paper turns to U.S. county data on land inequality over the period 1890-1930 to help address this fundamental question in political economy. Redistributive policy was primarily decided at the local level during this period, making county level data particularly informative. Examining within state variation also reduces the potential impact of latent institutional and political variables. The paper also uses a variety of identification strategies, including historic variables as well as county weather and crop characteristics as instruments for land inequality. The evidence consistently suggests that greater inequality is significantly associated with less redistribution. This negative relationship is especially large in heavily rural counties, where concentrated land ownership implied that landed elites also controlled the majority of economic production.

Keywords: Inequality, Redistribution

JEL Classification: O00, H00

Suggested Citation

Ramcharan, Rodney, Inequality and Redistribution: Evidence from U.S. Counties and States, 1890-1930 (January 12, 2009). Review of Economics and Statistics, Forthcoming. Available at SSRN: https://ssrn.com/abstract=1326615

Rodney Ramcharan (Contact Author)

University of Southern California, Marshall School of Business ( email )

2250 Alcazar Street
Los Angeles, CA 90089
United States

HOME PAGE: http://https://sites.google.com/site/rodneyramcharan/

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