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Market-Based Solutions to Vital Economic Issues


Kenan Institute 2024 Grand Challenge: Business Resilience
Market-Based Solutions to Vital Economic Issues
May 1, 2018

Inequality Rules: Resource Distribution and the Evolution of Dominance- and Prestige-Based Leadership


Ballooning levels of societal inequality have led to a resurgence of interest in the economic causes and consequences of wealth disparity. What has drawn less attention in the scientific literature is how different levels of resource inequality influence what types of individuals emerge as leaders. In the current paper we take a distal approach to understanding the psychological consequences of inequality and the associated implications for leadership. We describe how the distribution of resources in contrasting animal and small-scale human societies incentivizes dominance-oriented versus prestige-oriented leadership strategies, and we use this framework to tease out a number of implications for modern organizational environments. In particular, we suggest that higher levels of inequality attract and favor dominance-oriented rather than prestige-oriented leaders, and that inequality incentivizes leaders to favor their own self-interest over the interests of the organizations they lead. We describe the features of modern organizations that might facilitate the emergence of dominance-oriented leadership and discuss the downstream consequences for organizations. Finally, we explore the contextual and cultural moderators of inequality’s relationship with leader/follower dynamics.

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