How do you know its inequality when you see it?
Well, when one of two conditions are satisfied. The first one involves explicit rules or regulations that deny opportunities to people. So, a good example would be South African Apartheid. One group is denied privileges that are made available to others, and that’s inequality. Inequality is the desired result and it's actually what you observe.
The second condition, somewhat more subtle, is when you observe opportunities that are in principle available to everyone, but some people are taking advantage of them and others are not. That signals that one group does not have the skills, or the organizational capacity to take advantage of the opportunities. Something is missing. An example from the United States illustrates this second condition: private universities accept applications from everyone, but they get disproportionately very few applications from very poor people away from the two coasts – the east and the west coast.
The reason is that guidance counselors available to people that go to schools on the east coast, are not available at schools that people go to in poorer areas. They don’t come from families that have a history of going to college and so on, and therefore they don’t apply in the first place, even if they do somehow apply they don’t know how to write essays that will please the guidance counselors and so on. So, they end up not going to the college, perpetuating inequalities. So these are the two conditions.
What types of policies should be directed at tackling inequality?
Where you have enforced inequality, the policies would involve removing the restrictions that prevent people from taking advantage of opportunities that deny opportunities to others. Where skills are missing, then there’s no short term fix. So for the example I gave in in the last question, you have to provide resources to make guidance counselors available. That will increase the yield, gradually the percentage of people who get college education in the poorer areas will increase. Some of the benefits will emerge in the long run when they provide better guidance to their own children, and the catch up will take many generations. So I think we need to distinguish between the cases that can be resolved quickly and easily, and those that involve policies that will yield results over many generations.
What stands in the way of sustainable development?
Sustainable development has many definitions. I use the term in the sense of inclusive development. What stands in the way of inclusive development is fundamentally human greed. People form coalitions to reserve the privileges and benefits to themselves. This is something that exists in every society, some societies have managed looking ahead to make it harder to impose these restrictions. Make it harder for distributional coalitions to reserve benefits for themselves, and that makes it harder to put in place inequalities, or lasting inequalities. But fundamentally in every society, there are forces that try to generate inequalities. And it’s a never ending struggle to eliminate the inequalities, to undo the inequalities that have emerged, and to put in place general rules that would make it difficult though never impossible, for groups to establish rules that will give them advantages and disadvantage others.
Should there be a distinction between growth and development in order to achieve sustainability?
Yes. Growth refers to an expansion in the goods and services that a society produces. The goods and services produced by society may be available very widely, or alternatively they might be available to a small minority. They might be used efficiently, or they might be used inefficiently. In providing goods and services, health services, say to a particular group, we might do it in a way that minimises the costs of providing those services.
On the other hand, at the other extreme, there may be various groups that get in the way, that collect various rents in the process of delivering these services to others in which case the targeted groups get a small share of the intended, a relatively small share, of the intended benefits. In the case where resources are delivered efficiently and they are delivered quite equitably, growth and development are more or less equivalent, but they don’t have, you have growth but not necessarily development when the resources are distributed quite unequally, and inefficiently.