An Economic Analysis of the Davis-Moore Theory of Stratification

The Davis-Moore theory of social stratification is examined in light of the economics of wage deter-mination. The theorys explanation of unequal positional rewards in a perfectly competitive market is interpreted as focusing on talent and training as primary supply factors, and on functional contri-bution to the survival of society as a primary demand factor. Using elasticity of demand and of sup-ply in place of functional uniqueness and talent complementarity, respectively, the prediction is derived that talent and training have a greater influence on rewards than does functional importance. The theory is shown partially to accommodate apparent deviant cases, but the analysis also demon-strates that Davis and Moores emphasis on functional importance remains methodologically, empiri-cally, and theoretically questionable. During the nearly three decades of debate over Davis and Moores (1945) controversial treat-ment of social stratification (see Huaco, 1966), a fundamental similarity has frequently been noted between the Davis-Moore theory and the supply-demand scheme used in classical economics to explain wage differentials (e.g., Tumin, 1955; Wrong, 1959). With the excep-tion of an analysis by Simpson (1956), how-ever, the value of examining their argument in supply-demand terms has been largely ignored. Building on Simpsons effort, this paper de-velops an elaboration of Davis and Moores formulation which (1) clarifies some particu-larly troublesome aspects of the theory (and of the surrounding controversy); (2) enhances its predictive scope; and (3) improves its fit with certain empirical evidence. At the same time, this approach provides theoretical sup-port for objections raised by critics of the Davis-Moore theory concerning one of its central concepts, that of the differential func-tional importance of social positions. THE THEORY Davis and Moore (1945: 243-244) have at-tempted to isolate the universal causes ac-counting for inequality in the distribution of positional rewards! in societies-stratification * I wish to thank Frank Bean, Allan King, Joseph Lopreato, and Louis Schneider for their critical comments on a draft of this paper. 1 Such rewards include the things that con-tribute to sustenance and comfort; those which contribute to humor and diversion; and those