Wealth at the top of the income distribution is skyrocketing, leading to growing inequality. This trend is especially pronounced in the United States
Going by Most economists’ work , inequality in America is much more severe than in Europe. So why aren’t American economists more preoccupied with wealth inequality?
One reason is the deep influence of the so-called Chicago school. The economics department at the University of Chicago has long been a leader in the field; it has garnered the most Nobel Prizes of any university economics department and a significant number of John Bates Clark medals in economics. But inequality has never been a priority for the Chicago school, to say the least. It has a strong focusses on how to promote competition and economic growth and the benefits of a free market.
"In general, the [American] economics profession has avoided the subject of class conflict. All issues of distribution have been regarded as less pertinent than ideas of growth,"Arthur Goldhammer
Americans also tend to believe that those who are rich have earned it and earned the right to keep it; the nation has lower top tax rates than European nations. Those Americans writing about inequality (e.g. Galbraith, Richard B. Freeman, Jeffrey Williamson, to name a few) focus less on the rich and how much money they have, and more on labor markets, trade, and wage stagnation.
Perhaps the most well-known American economist to focus on inequality was Simon Kuznets (who was born in Belarus). Kuznets theorised in 1955 that inequality would first increase as a country developed, and then decrease over time.
In the 1970s and 1980s, Wall Street’s influence deeply shaped culture; the goal of making tons of money was accepted as normal
In general, after World War II, the economics discipline shifted from an appreciation of the government’s role in the economy to a belief that government should stay out of it
So where do we see India in this context. Yes India also is facing a similar problem of balancing the role of government in the midst of development and poverty.
One school of thought shall buy the argument that government has no business to be in business and that is where the development begins and corruption goes down. However the others believe with the inequality India is facing Government need to step in and make sure the benefits of growing economy equally distributed
India, the world’s other super-giant country, has nonetheless been steady and impressive. India’s real per capita gross domestic product has more than quadrupled in the past 35 years:
So one can proudly say that the Government is on right path and adding to youth population in the country India heading towards super giant.