3.1 Motivations and Objectives

In the income distribution literature attempts were made to relate the concept of “bipolarization,” “shrinking middle class,” to the population share in some well-defined middle-income group of the society. Thus, in a highly polarized society individuals are disproportionately placed in the upper and lower ends of the income distribution. Such movements of the individuals toward the extremes are likely to have negative consequences on social and political relations. In Chapter 1 we have argued that a well-off and sizable middle-income group of an economy contributes to the wellbeing, peace, and democracy of the society in many ways. Therefore, a desirable objective of a policy planner is to recommend policies that can make the society less bipolarized or, equivalently, more depolarized. The subject of this chapter is to present an analytical discussion on depolarization.

The aforementioned notion of polarization contrasts with the concept of income “multipolar” polarization, suggested by Esteban and Ray (1994) (see also Duclos, Esteban, and Ray, 2004; Esteban and Ray, 2012). The three properties that are taken to be innate to this concept of polarization are (i) polarization is a matter of subgroups, (ii) with two or more subgroups, polarization increases when “within-group” dispersion reduces, and (iii) polarization increases when “between-group” distances rise. Properties (ii) and (iii) represent respectively the “identification”/attachment and “alienation”/detachment components of polarization.