Group Inequality and Conflict

Idranil Dutta, Paul Madden, Ajit Mishra

Research output: Working paper / PreprintWorking paper

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This paper presents a theoretical model to show how distributional concerns can engender social conflict. We have a two period model, where the cost of conflict is endogenous in the sense that parties involved have full control over the level of conflict they can create. Our analysis highlights the crucial role of future inequality. It is shown, equality of assets or income in the current period does not stop conflict from taking place if the anticipated future inequality is significant. Further we find that the impact of inequality on conflict is not straightforward. Since conflict is costly for both groups, societies with low levels of inequality show no conflict; groups engage in conflict only when inequality exceeds a certain threshold level. Additionally the model shows that the link between inequality and conflict may be non-monotonic.
Original languageEnglish
Place of PublicationBath, U.K.
PublisherDepartment of Economics, University of Bath
Publication statusPublished - 2012

Publication series

NameBath Economics Research Working Papers


  • conflict
  • group inequality
  • Nash bargaining


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