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Economist Amartya Sen speaks on economic inequality’s roots, effects

Amartya Sen received the 1998 Nobel Prize in economics for his research on social welfare and equality, particularly in developing countries. Credit: Creative Commons

Amartya Sen received the 1998 Nobel Prize in economics for his research on social welfare and equality, particularly in developing countries. Credit: Creative Commons

“What’s wrong with inequality?” That was the question posed by Nobel Prize winning economist Amartya Sen during his lecture at Ohio State on Tuesday evening.

Sen, who was awarded the 1998 Nobel Prize in economics for his work in welfare economics, is currently a professor at Harvard University. He has previously been described as the “conscience of the (economic) profession” because of his focus on economic growth and social justice. Sen is also credited with large contributions to the creation of development indices that are used to measure the wellbeing of people in developing countries.

The lecture was the first part of the Distinguished Lecture in Ethics, an annual lecture held by the Center for Ethics and Human Values. Executive Vice President and Provost Bruce McPheron said the goal of the series is to bring one high-profile speaker to Columbus each year.

“As a university community, we believe in and support the core value of bringing together faculty, students and staff from a variety of disciplines, to discuss the interaction and impact of significant human issues and the underlying importance of their ethical and moral implications,” McPheron said.

Sen began his lecture on the problems of inequality by first highlighting the importance of equality in society. He said that equality is a central tenet of many societies, but it is important to examine why societies deem equality important.

The desire for equality is not just limited to income and wealth, he said. Instead, Sen argued, many ethical theories demand equality of something other than money, that is still valued by those who subscribe to the theory. For example, a libertarian might not see the need for equal freedom for all citizens, while others might see a fair society as the equal distribution of resources.  

“It is hard to accept a case for giving more consideration to the interests of some people than to those of others without there being some clearly discernable reason for paying particular attention to the favored people,” he said

Sen describes this phenomenon as the desire to “avoid arbitrariness,” which he considers central to ethics. Sen said that while this argument is not enough to show that inequality is wrong it sets a solid foundation.

Sen said another key facet of inequality is the growing division between the rich and the poor, which has been an issue in many parts of the world, including the United States. As inequality increases, the standard of living is worse for those at the bottom of the economic ladder than it would have been without the relative inequality, Sen said.

“There is empirical evidence that living in unequal societies with some people being much worse off, economically and socially, tends to produce deprivations in the absolute quality of life that people enjoy,” he said.

Sen cited an experiment from the United Kingdom that studied two groups of civil servants — one of which was less economically privileged than the other. The study found that the less privileged group had a lower life expectancy, often because of poor health care and frustration generated by their relatively inferior lifestyle.

Sen also discussed the importance of economic and social freedom.

“With freedom comes both opportunity and responsibility,” Sen said. “For the idea of freedom also sets up the ability to determine what we want, what we value and, ultimately, what we decide to choose and for what reason.”

Sen said freedom is not just limited to the right to do as one pleases, but also having the capabilities or means to follow through on those desires. He argued that the capability to succeed is not just a result of income or wealth, but could also be related to other issues that cause inequality, such as those faced by people with disabilities.

Sen cited a study showing that while 18 percent of British families live below the poverty line, 23 percent of British families with a disabled family member lived in poverty. Sen called this income differential the “earnings handicap.” However, there is another issue at play as well, Sen said. A person with a disability might also face other expenses, such as medical equipment, that would not typically be faced by others in poverty. Sen called this the “conversion handicap.”

Wyatt McDaniel, a third-year in psychology, attended the event to learn more about why some economists oppose inequality.

“I came to the event today, in particular, because I’m not too friendly to the view that inequality is an important social problem — so I wanted to see someone defend that view,” he said.

McDaniel said he thought Sen did a good job of covering his central points, and despite relying too much on historical events, covered a lot of important topics in a short amount of time.

Sen wrapped up his lecture with a Q&A with members of the OSU community. During the session he discussed more problems tied to inequality. Sen said poorer members of unequal societies have less influence on public policies.

“If you live poor in a poor country, you don’t mind — you can participate in the public discussion,” he said. “On the other hand, (if you are poor in a rich country), you cannot appear in public without having certain things.”

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