Globalization and Redistribution: Feasible Egalitarianism in a Competitive World

PERI Working Paper No. 34

36 Pages Posted: 21 Nov 2002

See all articles by Samuel Bowles

Samuel Bowles

Santa Fe Institute; University of Massachusetts

Date Written: 2002


A reduction of impediments to international flows of goods, capital and professional labor is thought to raise the economic costs of programs by the nation state (and labor unions) to redistribute income to the poor and to provide economic security. But some of the more politically and economically successful examples of such policies - for example Nordic social democracy and East Asian land reform - have occurred in small open economies which would, on the above account, provide a prohibitive environment for egalitarian interventions. I present a model of globalization and redistribution to answer the following question: In a liberalized world economy, what programs of egalitarian redistribution and social insurance are implementable by democratic nation states acting independently?

While in the absence of international coordination, globalization indeed makes it difficult for nation states to affect the relative (after tax) prices of mobile goods and factors of production and for this and other reasons may limit the effectiveness of some conventional strategies of redistribution, a large class of state and trade union interventions leading to substantial improvements in the wages, employment prospects, and economic security of workers is not ruled out by globalization. Included are redistributions of assets which provide efficient solutions to incentive problems arising in principal agent relationships such as wage employment, farm and residential tenancy.

Suggested Citation

Bowles, Samuel, Globalization and Redistribution: Feasible Egalitarianism in a Competitive World (2002). PERI Working Paper No. 34. Available at SSRN: or

Samuel Bowles (Contact Author)

Santa Fe Institute ( email )

1399 Hyde Park Rd
Santa Fe, NM 87501
United States
505-984-8800 (Phone)
505-982-0565 (Fax)


University of Massachusetts ( email )

Amherst, MA 01002
United States
413-545-2590 (Phone)


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