alt Hacker NewsThis article seems to establish that kinship leads to the failure of wage growth and ultimately wealth, people will hide their wages because people will ask for money. This seems like the issue rather is is that wealth accumulation in sub-saharan africa is limited to a small subset of population, I don't think this wealth tax by family members exists when you have a larger group of individuals making more money.
You can observe this in the US, and presumably in the rest of the world, when wealth is concentrated to individuals, your family will probably ask you for money. The difference is here, there is less income inequality and more people have the ability to make more money.
I do like the look into funeral culture, but I don't think this assumption that kinship and family-peity is the cause of the lack of economic mobilty.
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I think author's point is that wealth drives investment which drives economic growth. In the case of lavish funerals - warranted in kinship societies - the wealth is spent on relatively unproductive investments bearing high opportunity cost. The corollary and author's secondary point is the ineffective resource allocation e.g. through nepotism.
My main (oversimplified!) takeaway from the article is that kinship societies prioritize inherently local processes that inhibit global processes. For example, they prefer keeping internal cohesion through ritual celebration rather than maximizing economic upside through education and specialization. This makes sense - the latter requires a higher degree of trust and stability. Increasing the degree of trust and stability seems to be an evolutionary process. I found Jared Diamond's Guns, Germs, and Steel [1] to give some amazing insights about this.
[1] https://www.goodreads.com/book/show/1842.Guns_Germs_and_Stee...
Ghana's GINI index is only a couple points higher than the US (43 vs 41), and the same as Mexico.
I don't think wealth inequality explains this at all. But what rigid social institutions of any kind tend do is inhibit mobility. Moreover, kinship groups like this tend to lock-in relative wealth by lineage--the wealthiest family of a kin group from 3 generations ago will be much more likely (relative to other cultures) to be the wealthiest family 3 generations from now. Greater mobility means productivity increases faster, which raises absolute wealth for everybody even if relative wealth disparities across the entire population remain constant.
Strong extended kinship ties are associated with less economic prosperity all over the world, it just in Africa but Pakistan, the Middle East, etc.
There is a plausible argument that it’s causal. Europe had weaker kinship ties—for various reasons, including the Catholic church’s ban on cousin marriage—back in the middle ages, before Europe began pulling away from the rest of the world in terms of GDP per capita. Even within the U.S., communities with weak kinship ties (e.g. Northeastern Anglo-Protestants) are more economically successful than communities with stronger kinship ties and clan structures (e.g. Appalachians).
Arguably, more atomized societies with weak kinship ties foster the development of civil institutions and governments to compensate for the social structural functions that would otherwise be performed by kinship networks.
I'm kind of astonished that you think this, there are lots of studies about intergenerational economic mobility in the USA compared to other places.
https://www.chicagofed.org/research/content-areas/mobility/i... for instance.
https://www.mdpi.com/1660-4601/17/4/1179
Anecdotally, I can also attest to it. I know lots of "finally successful" folks who end up spending their wealth keeping their siblings and extended family afloat. There's no real safety net for them in the USA.
This is the most insightful comment in this thread. Unfortunately Oks decided to use a clickbait title that made people jump to conclusions.
Sure, wealth accumulation is limited to a subset of the population there, but this is true everywhere. The reasoning error here is thinking in terms of absolute incomes across the group, rather than the relative incomes of the members.
Yes, people in the US make more money, on average, than the average Ghanaian, but the relative incomes of a family are just as disparate as those of Ghanaians. If someone in the US gets a better job, the whole family doesn't suddenly also get better jobs.
This is why the kinship system is so economically counterproductive: The collective expectation effectively levels everyone down; any individual who begins to accumulate wealth faces pressure to redistribute it across the group. Nobody can grow their fortune, because that requires both having some fortune initially and being able to make investments that compound it. If the kinship group makes sure your fortune can't increase, any compounding you manage to do doesn't matter, because the initial capital always stays small.
The difference is that it's pretty acceptable for you to reject family requests for money, it doesn't make you a pariah and being a pariah doesn't carry the same consequences when non-family institutions govern society.
The article spends a lot of time belaboring this point: you don't have to do what your family asks you to do in developed countries. On the other hand, becoming outcast from your family in a kinship-dominated society means you have nowhere else to turn to which is enormous pressure.