Organizations and Economic Inequality

Abstract Economic inequality has been rising for a half-century in most countries, in some cases to levels not seen since the eighteenth century. It has severe negative consequences for many aspects of social life: interpersonal trust, status competition, happiness, participation in civic and political life, crime and corruption, and health. It is shaped by the actions of organizations because they are the most powerful forces in modern societies: ubiquitous, often quite large and well-resourced, and highly institutionalized. While there is a large literature on the impact of organizations on inequality within organizations, that work mostly focuses on demographic categories like gender and race. Far less has been done to study how organizations shape economic inequality at the societal or global level. Here, I discuss three ways organizations that shape economic inequality: as employers, as policy-setters, and as buyers/sellers. I review the scant organizational literature on societal and global inequality, and offer several suggestions for future research on this critical topic.