Class struggle: Some diluting effects of
Raaj Sah and Philippe Penelle
University of Chicago, Harris School of Public Policy. Working paper series 03.01. November 2002.
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Karl Marx viewed class struggles to be so central as to assert that all societal history was, and will in the future be, merely a succession of struggles between classes. Many authors have elaborated upon such themes within Marxist frameworks; some have used these as prisms to interpret various past events, especially outside North America.
Our neoclassical analysis posits that the welfare of one’s own progeny matters to each individual. Taking this into account, each of the classes (namely, the poor and the rich) chooses how much resources to spend on influencing the stochastic outcomes of class struggle in their respective favors. These conflicts are depicted as non-cooperative games.
An implication of the inter-generational concerns is that a society’s inter-class economic mobility across generations turns out to be a central determinant of the classes’ choices. Among the results that we present is that, in a society with greater class mobility: (i) the poor spend less on class struggle, (ii) the rich may spend less or more, but (iii) the probability of a successful class struggle is lower. Our analysis also suggests that class struggle might disappear altogether in societies with high levels of class mobility.