María Cubel (with S.Sánchez-Pages)
Universitat de Barcelona
Seminar 3 – 11:30
In this paper, we investigate how the success of a community in a conflct against an out-group varies with its level of inequality. We show that there is a natural relationship between groups’ winning probabilities and the Atkinson index of inequality. The properties of this index allows us to show that when members’ efforts are complementary or the cost of effort is convex enough, more egalitarian communities enjoy a higher likelihood of victory. The opposite holds when membersíe§orts are substitutes or their cost is linear enough. Next, we obtain conditions under which progressive redistribution can emerge voluntarily as a response to the presence of an external conflict. We draw some parallels between this results and historical examples of changes in the military technology and income redistribution. Finally, we show that if a market for effort exists, more inequality unambiguously increases the chances of a group in the confrontation.