A Cultural Evolution Model for Trend Changes in the American Secular Cycle

Abstract

Rising economic inequality in the United States has become a topic of political interest in recent years. Inequality appears to show cycles corresponding to secular cycles, suggesting the possibility of declining inequality in the future. The most recent episode of declining inequality in America is known as the Great Compression. It occurred in the middle of the twentieth century. This paper uses the guided variation cultural evolution model (Boyd and Richerson 1985: 95-97) to explain shifting trends in inequality in five nations. According to this analysis, the Great Compression was largely due to a shift in the business environment reflecting tax and other economic policy implemented over the 1914-45 era. The cultural evolutionary response to this environmental change was to replace "shareholder primacy" cultural variants with "stakeholder capitalism" variants, which resulted in lower inequality. Half a century later, new policy, implemented in response to the great inflation following the collapse of the Bretton Woods system, changed the business environment again in ways that favored shareholder primacy cultural variants and rising inequality. The extent to which this occurred depended on the degree to which stakeholder capitalism was integrated into institutions.

State crisis theory: A systematization of institutional, socio-ecological, demographic-structural, world-systems, and revolutions research

“…51-3;Modelski, 2012, pp. 72-73;Arrighi, 2010Arrighi, [1994; Van Bavel, 2016;Alexander, 2019;Gill, 1993;Turchin Nefedov, 2009;Amin, 2010;Moore, 2015. territorial expansion c Tainter, 1988, pp.…”

“…414-415;Amin, 2010). Declining profits may in turn motivate a shift from investment to finance (Arrighi, 2010(Arrighi, [1994; Van Bavel, 2016), attempts at wage suppression (Alexander, 2019) and direct coercion (Gill, 1993;Turchin and Nefedov, 2009), and can motivate territorial expansion in search of more resources, cheaper labour, and new markets (Wallerstein, 1974b, p. 414-415;Amin, 2010;Moore, 2015).…”

State Crisis Theory: A systematization of institutional, socio-ecological, demographic-structural, world-systems, and revolutions research

“…One theory of falling profits that is not directly related to previously mentioned diminishing returns links overaccumulation to declining demand: since goods cost more than wage earners are paid to produce them, wage earners eventually become unable to afford the goods that are produced (Wallerstein 1974b: 414-415;Amin 2010). Declining profits may in turn motivate a shift from investment to finance (Arrighi 2010(Arrighi [1994, Van Bavel 2016), attempts at wage suppression (Alexander 2019) and direct coercion Nefedov 2009, Gill 1993), and can motivate territorial expansion in search of more resources, cheaper labour, and new markets (Amin 2010, Wallerstein 1974b: 414-415, Moore 2015.…”