Inequality and Innovativeness

10 Pages Posted: 2 Mar 2013  

Scott E. Page

University of Michigan - Center for the Study of Complex Systems

John Vandermeer

University of Michigan - Department of Ecology and Evolutionary Biology

Date Written: March 1, 2013

Abstract

In this note, we construct two theoretical models that analyze the relationship between inequality of access and rates of innovation as well as correlative data that show a negative correlation between income inequality and levels of innovativeness. Our two models suggest that unequal access to problems slows innovation by reducing the level and variety of human capital applied to problems. More interestingly, both models show that the rate of innovation decline becomes much more pronounced as problems become more difficult. Thus, the costs of inequality may be increasing as the problems that societies face become more challenging.

Keywords: Inequality, Innovation

JEL Classification: D83, D31

Suggested Citation

Page, Scott E. and Vandermeer, John, Inequality and Innovativeness (March 1, 2013). Available at SSRN: https://ssrn.com/abstract=2227002 or http://dx.doi.org/10.2139/ssrn.2227002

Scott E. Page (Contact Author)

University of Michigan - Center for the Study of Complex Systems ( email )

317 West Hall
Ann Arbor, MI 48109
United States

John Vandermeer

University of Michigan - Department of Ecology and Evolutionary Biology ( email )

500 S. State Street

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