News Inequalities Between Rich and Poor

[Economist]

Interesting short article: http://www.slate.com/id/2161309/

As you've probably heard, there's been an explosion of inequality in the United States over the past four decades. The gap between high-skilled and low-skilled workers is bigger than ever before, and it continues to grow.

How can we close the gap? Well, I suppose we could round up a bunch of assembly-line workers and force them to mow the lawns of corporate vice presidents. Because the gap I'm talking about is the gap in leisure time, and it's the least educated who are pulling ahead.

Second, a certain class of pundits and politicians are quick to see any increase in income inequality as a problem that needs fixing—usually through some form of redistributive taxation. Applying the same philosophy to leisure, you could conclude that something must be done to reverse the trends of the past 40 years—say, by rounding up all those folks with extra time on their hands and putting them to (unpaid) work in the kitchens of their "less fortunate" neighbors. If you think it's OK to redistribute income but repellent to redistribute leisure, you might want to ask yourself what—if anything—is the fundamental difference.

 

[opus]

And what are your comments on this article? What are we supposed to discuss?

 

[mjsd]

hahaha...

inequality of a different kind. or is it?

you work harder and you have less time to play but
once you have more money, you can hire ppl to do the work for you.
So then you could have more time to play, but
you can't afford paying all those ppl forever and you need to work harder again...


the moral I think is that you can't have it both ways in this world.

 

[Art]

Does this thread meet the forum guidelines??

 

[BobG]

Does this thread meet the forum guidelines??

Technically, no, since he just tossed an article out there.

However, the article itself does illustrate that income inequality isn't the only factor to consider. Living conditions among lower incomes have improved, even if not as much as living conditions for people with higher incomes (although that could be debatable - above a certain threshold, increasing income becomes a lot less significant in improving quality of life than other things in a person's life - of course, that could also be used as an argument for taxing people with higher incomes more).

A lot of the debate over inequality of income is based more on humans' innate sense of fairness or unfairness than whether quality of life is being improved for people with lower incomes.

In fact, people are more willing to accept less income in absolute terms than an unfair distribution of wealth. In the "ultimatum game", one player gets to divide a pool of money (or some other commodity) between him and a second player. The only choice the second player has is to accept the offer or reject the offer. If he accepts, both players receive the distribution offered by the first player. If he rejects, neither player gets any money. If the second player is offered less than 20% of the pool, he almost always rejects the offer even though it means he receives nothing (of course, the player dividing the pool usually offers the second player somewhere around 40% and almost never below 15%, even though, logically, you could expect the second player to accept almost any small pittance per the Pirate's Problem Microsoft liked to pose to job applicants - at least until someone observed that maybe they were unintentionally sending a message to job applicants about how Microsoft determined the size of pay raises).

A variation of the ultimatum game explores the affect relative wealth has on what is usually offered and what is usually accepted: Do Wealth Differences Affect Fairness Considerations. Naturally, a 'wealthier' person could be expected to offer more fair distributions of the pool to be divided, right?

Well, not exactly... Actually, a wealthy person is more likely to offer an 'unfair' distribution of the pool and the poor person is more likely to accept unfair distributions even below 20%. A wealthier person would be more likely to adapt the attitude of the author of Economist's article and justify a more unfair distribution.

 

[Evo]

No, it doesn't meet guidelines.