Equality and Efficiency: The Big Tradeoff [Arthur M Okun] on *FREE * shipping on qualifying offers. Book by Arthur M Okun. Equality and Efficiency: The Big Tradeoff (A Brookings Classic) [Arthur M. Okun, Lawrence H. Summers] on *FREE* shipping on qualifying offers. Arthur Okun is known mainly for Okun’s Law, which describes a linear relation In Equality and Efficiency, the Big Tradeoff Okun introduced the metaphor of the.
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Ships from and sold by Amazon. Do societies inevitably face an invidious choice between efficient production and equitable wealth and income distribution? Inequality is not new but it was much less extreme when this book was written. The late Yale University and Brookings Institution economist said that not only can more equal distribution of incomes reduce incentives to work and invest, but the efforts to redistribute—through such mechanisms as the tax efriciency and minimum wages—can themselves be costly.
Finance & Development, September – Equality and Efficiency
The analysis suggests that a number of variables found to be important in other contexts also tend to be associated with longer growth spells see Chart 4.
Countries may find that improving equality may also improve efficiency, understood as more sustainable long-run growth. Hazard to arhhur growth Somewhat surprisingly, income inequality stood out for the strength and robustness of its relationship with the duration of growth spells: The market needs to be kept in it’s place. To show the importance of each variable, the chart which covers to reports the increase in the expected duration of a growth spell for a given increase in the variable in question, keeping znd factors constant.
Sheds considerable light on today’s obsession with inequality. To achieve this, we increase each variable by an amount such that etficiency moves from the median value to a value greater than that observed in 60 percent of the sample a 10 percentile increase.
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Okun clarifies the issues surrounding the tradeoff between equality and efficiency, rather than taking a firm position on the issue of how much society should exchange one for the other.
However, even accepting this as more of an informal work arthu an academic work, there are some serious shortcomings in the arguments.
Learn more about Amazon Prime. In classrooms Arthur M. China, India and the Global Economyed. Okun is today remembered as an effective mediator between the realms of economic theory and analysis and the development and implementation of public policy. Some euqality it will simply disappear in transit, so the poor will not receive all the money that is taken from the rich”.
Inequality still matters when we allow for regional differences in expected growth duration such as between emerging Asia and Africa. Still, ffficiency may be some win-win policies, such as better-targeted subsidies, better access to education for the poor that improves equality of economic opportunity, and active labor market measures that promote employment.
A Brookings Classic Paperback: English Choose a language for shopping. Arthur Melvin Okun is widely considered among the most important macroeconomists of the twentieth century.
The recent global economic crisis, with its roots in U. The Big Tradeoff is a very equaity work from one of the most important macroeconomists of the last hundred years.
These cases, and our broader statistical analysis of a large number of growth episodes, suggest that inequality is an underlying feature that makes it more likely that a number of factors—external shocks, external debt, ethnic fractionalization—come together to bring a growth spell to an end. Subscribe or Modify your profile. When there are short-run trade-offs between the effects of policies on growth and income distribution, the evidence we have does not in itself say what to do.
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Alan Winters and Shahid Yusuf Washington: With inequality growing in the United States and other important economies, the relationship between inequality and growth takes on more efficeincy. Buy the selected items together This item: Equality and Efficiency is the perfect embodiment of that legacy, valued both by professional economists and those readers with a keen interest in social policy.
Okun argues persuasively that we need to use the dynamics of a market economy to generate growth, but efficidncy embed markets in a reasonable framework of laws and regulations to ensure provision of basic public goods, check abuses, curb inequality, and preserve competition.
Read reviews that mention equality and efficiency arthur okun society economics inequality political economic relevant wealth academic college country ideas income insightful thought-provoking tradeoff. The Big TradeoffArthur Okun argued that pursuing equality can reduce efficiency the total output produced with given resources.
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