Rising Inequality and Political Change – America’s Gilded Age and India’s Current Billionaire Raj

Simplified version of Kuznets Curve Hypothesis – during the initial rapid development phase of an economy, some people get ahead first and become phenomenally rich. This leads to a sharp increase in inequality. Then a middle class develops, and people start asking for more social protections. As the economy matures and economic opportunities become more widely available, and, as redistribution policies gain political support, inequality gradually declines. 
In the US, the period between the 1890s and the 1930s saw transformative economic, social and political changes. The following piece discusses America’s robber barons, the gilded age, and Roosevelt’s anti-trust movement:

The Transformation of American Democracy: Teddy Roosevelt, the 1912 Election, and the Progressive Party

https://www.heritage.org/political-process/report/the-transformation-american-democracy-teddy-roosevelt-the-1912-election

Currently, India is experiencing a rapid rise in inequality:

http://www.milkenreview.org/articles/can-india-break-out-of-the-inequality-trap

James Crabtree notes:

https://www.linkedin.com/pulse/rise-indias-super-rich-threatening-countrys-chance-economy-crabtree

“The crony capitalism of America’s Gilded Age ended when rampant nineteenth-century clientelism was curbed by impartial, meritocratic twentieth-century public administration. The kind of concentrated power built up by tycoons like Cornelius Vanderbilt was undone through the introduction of new antitrust law and competition policy. Improvements in basic public services gradually broke the grip of political patronage, a process that developed over many decades after the Gilded Age itself, culminating only with the New Deal of the 1930s.

In India’s case, similar breakthroughs will require a focus on what is often called “state capacity.” Ending corruption is part of this battle, but it also involves the more complex objective of building a state machinery able to create and implement wise public policies, while remaining impartial between different social groups. That this can be done is clear from the case of China, which achieved huge social and economic progress while also being amazingly corrupt, largely because its machinery of state is so capable”.