Tom Hertz

Intergenerational Wealth Transmission and the Dynamics of Inequality in Small-Scale Societies

Origins of Egalitarianism Wealthy contemporary societies exhibit varying extents of economic inequality, with the Nordic countries being relatively egalitarian, whereas there is a much larger gap between top and bottom in the United States. Borgerhoff Mulder et al. (p. 682; see the Perspective by Acemoglu and Robinson) build a bare-bones model describing the intergenerational transmission of three different types of wealth—based on social networks, land and livestock, and physical and cognitive capacity—in four types of small-scale societies in which livelihoods depended primarily on hunting, herding, farming, or horticulture. Parameter estimates from a large-scale analysis of historical and ethnographic data were added to the model to reveal that the four types of societies display distinctive patterns of wealth transmission and that these patterns are associated with different extents of inequality. Some types of wealth are strongly inherited and, hence, contribute to long-term economic inequality. Small-scale human societies range from foraging bands with a strong egalitarian ethos to more economically stratified agrarian and pastoral societies. We explain this variation in inequality using a dynamic model in which a population’s long-run steady-state level of inequality depends on the extent to which its most important forms of wealth are transmitted within families across generations. We estimate the degree of intergenerational transmission of three different types of wealth (material, embodied, and relational), as well as the extent of wealth inequality in 21 historical and contemporary populations. We show that intergenerational transmission of wealth and wealth inequality are substantial among pastoral and small-scale agricultural societies (on a par with or even exceeding the most unequal modern industrial economies) but are limited among horticultural and foraging peoples (equivalent to the most egalitarian of modern industrial populations). Differences in the technology by which a people derive their livelihood and in the institutions and norms making up the economic system jointly contribute to this pattern.

Wealth transmission and inequality among hunter-gatherers.

We report quantitative estimates of intergenerational transmission and population‐wide inequality for wealth measures in a set of hunter‐gatherer populations. Wealth is defined broadly as factors that contribute to individual or household well‐being, ranging from embodied forms, such as weight and hunting success, to material forms, such as household goods, as well as relational wealth in exchange partners. Intergenerational wealth transmission is low to moderate in these populations but is still expected to have measurable influence on an individual’s life chances. Wealth inequality (measured with Gini coefficients) is moderate for most wealth types, matching what qualitative ethnographic research has generally indicated (if not the stereotype of hunter‐gatherers as extreme egalitarians). We discuss some plausible mechanisms for these patterns and suggest ways in which future research could resolve questions about the role of wealth in hunter‐gatherer social and economic life.

Pastoralism and Wealth Inequality: Revisiting an Old Question

Pastoralist societies are often portrayed as economically egalitarian, reflecting the volatile nature of livestock herds and the existence of multiple institutions that allow for the redistribution of wealth as a form of insurance. Motivated by an interest in the role of intergenerational transmission in structuring persistent inequality, we examine the extent of intergenerational transmission of material wealth (four measures) and embodied wealth (one measure) for four pastoral populations from different parts of the world (East Africa, West Africa, and southwest Asia). We find substantial levels of intergenerational transmission and marked economic inequality. We argue that the high correspondence between the material wealth of parents and offspring reflects the importance of the family in the transmission of wealth through bequests, positive assortment by wealth in the domains of marriage and herd management, and positive returns to scale as might occur when raising or defending large herds. We conclude that the analysis of intergenerational transmission provides new insights into the much‐debated extent of egalitarianism among pastoralists.

Production Systems, Inheritance, and Inequality in Premodern Societies

Premodern human societies differ greatly in socioeconomic inequality. Despite much useful theorizing on the causes of these differences, individual‐level quantitative data on wealth inequality is lacking. The papers in this special section provide the first comparable estimates of intergenerational wealth transmission and inequality in premodern societies, with data on more than 40 measures of embodied, material, and relational wealth from 21 premodern societies representing four production systems (hunter‐gatherers, horticulturalists, pastoralists, and agriculturalists). Key findings include (1) the importance of material, embodied, and relational wealth differs significantly across production systems, with material wealth more important in pastoral and agricultural systems; (2) the degree of wealth transmission from parent to offspring is markedly higher for material wealth than embodied and relational wealth; (3) aggregate wealth is transmitted to a higher degree among pastoralists and agriculturalists; (4) the degree of inequality is greater for material wealth; and (5) the degree of intergenerational transmission of wealth is correlated with wealth inequality. Surprisingly, horticulturalists exhibit no greater wealth inequality or intergenerational wealth transmission than do hunter‐gatherers, while pastoralists are very similar to agriculturalists. We discuss how these trends may have favored the emergence of institutionalized inequality, as intensified forms of production made material wealth transmission increasingly important.

Domestication Alone Does Not Lead to Inequality: Intergenerational Wealth Transmission among Horticulturalists

We present empirical measures of wealth inequality and its intergenerational transmission among four horticulturalist populations. Wealth is construed broadly as embodied somatic and neural capital, including body size, fertility and cultural knowledge, material capital such as land and household wealth, and relational capital in the form of coalitional support and field labor. Wealth inequality is moderate for most forms of wealth, and intergenerational wealth transmission is low for material resources and moderate for embodied and relational wealth. Our analysis suggests that domestication alone does not transform social structure; rather, the presence of scarce, defensible resources may be required before inequality and wealth transmission patterns resemble the familiar pattern in more complex societies. Land ownership based on usufruct and low‐intensity cultivation, especially in the context of other economic activities such as hunting and fishing, is associated with more egalitarian wealth distributions as found among hunter‐gatherers.

Intergenerational Wealth Transmission among Agriculturalists: Foundations of Agrarian Inequality

This paper uses data from eight past and present societies practicing intensive agriculture to measure the transmission of wealth across generations in preindustrial agricultural societies. Focusing on embodied, material, and relational forms of wealth, we compare levels of wealth between parents and children to estimate how effectively wealth is transmitted from one generation to the next and how inequality in one generation impacts inequality in the next generation. We find that material wealth is by far the most important, unequally distributed, and highly transmitted form of wealth in these societies, while embodied and relational forms of wealth show much weaker importance and transmission. We conclude that the unique characteristics of material wealth, and especially wealth in land, are key to the high and persistent levels of inequality seen in societies practicing intensive agriculture. We explore the implications of our findings for the evolution of inequality in the course of human history and suggest that it is the intensification of agriculture and the accompanying transformation of land into a form of heritable wealth that may allow for the social complexity long associated with agricultural societies.

Pastoralism and Wealth Inequality

Pastoralist societies are often portrayed as economically egalitarian, reflecting the volatile nature of livestock herds and the existence of multiple institutions that allow for the redistribution of wealth as a form of insurance. Motivated by an interest in the role of intergenerational transmission in structuring persistent inequality, we examine the extent of intergenerational transmission of material wealth (four measures) and embodied wealth (one measure) for four pastoral populations from different parts of the world (East Africa, West Africa, and southwest Asia). We find substantial levels of intergenerational transmission and marked economic inequality. We argue that the high correspondence between the material wealth of parents and offspring reflects the importance of the family in the transmission of wealth through bequests, positive assortment by wealth in the domains of marriage and herd management, and positive returns to scale as might occur when raising or defending large herds. We conclude that the analysis of intergenerational transmission provides new insights into the much‐debated extent of egalitarianism among pastoralists.