The Political Effects of Wealth Inequality: Evidence from a Danish Land Reform

Lasse Aaskoven*

*Corresponding author for this work

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Abstract

A prevalent viewpoint is that wealth inequality leads to political inequality and that economic elites are more powerful when they control a larger wealth share. However, as wealth inequality changes are often endogenous, studying the political consequences of wealth concentration is challenging. I study a 1919 Danish land reform that confiscated 20 to 25 percent of the value of entailed estates, which were old aristocratic land and capital holdings. Using difference-in-difference estimation, I assess the political effects of this shock to local wealth inequality. I find no effect of a wealth inequality decrease on pro-elite political outcomes. These results question the degree to which wealth inequality matters for political equality under widely held political rights and strong rule of law.
Original languageEnglish
JournalComparative Politics
Volume55
Issue number1
Pages (from-to)143-164
ISSN0010-4159
DOIs
Publication statusPublished - 1. Oct 2022

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