How Much Inequality Is The Right Amount Of Inequality?

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There are of course those who insist that the correct amount of inequality is none. Although those tend to be the people who think that they’ll be running the society and that those who run society don’t have to be quite as equal as all that.

Still, it’s an important question to ask when considering how much inequality we should have in a human society. We know that we can ameliorate at least some of any excess, just take stuff off those with more and give it to those with less. And we’re definitely going to do that in some sense in any human society. At least produce a livable minimum for those who simply cannot fend for themselves if nothing more.

So, how much is the right amount? We can appeal to efficiency, and ask well, how much provides and incentive for people to strive for the future? That’s what produces economic growth after all, also known as making our children better off than we are. We can look at efficiency again and think that too much reduces that future growth and wealth. A difficult thing to believe of course but there are some who do.

Another approach would be to ask well, how much inequality is natural? Hey, perhaps we still want to alter that, but it gives us a starting point at least.

Viewing nature we get rather a large amount of inequality out there. It’s very few stags who get to breed with lots of hinds. There are any number of deaths out there from within species predation which is a pretty extreme form of inequality. Something like one in 10 million cod eggs get to be cod laying eggs.

Can we be more accurate than this though? Yes, we can.

For those of you that don’t know, hermit crab exoskeletons are not very serious defensive shells, so they move into harder shells of other creatures that have died. The crab’s ability to grow is based on finding a shell that is big enough for them to grow into, but small enough for them to still maneuver. Since mollusks do not stop growing as they age, a hermit crab may go through several shells in its lifetime. Basically, their success as individuals is based on finding natural resources and using them in a rivalrous and excludable manner. And they result is inequality.

Sounds a lot like humans … except that there aren’t monetary/political/legal/social/cultural forces making it happen. This suggests that equality is not the null hypothesis we should be using for assessing human affairs.

The paper is here:

In general the distribution of shells exhibits a level of inequality more like that in small-scale human groups rather than in large-scale, nation-based ones. First, the Gini coefficient for the crabs is 0.32 (0.02 standard deviation of the estimation of the Gini with two-sided, 95% confidence interval 0.285 0.35). This is greater than the estimates for some small-scale human groups but less than those for present nation states.

Yes, agreed, this is now becoming a little bit of a stretch but if 0.32 is normal then Sweden’s too equal and the UK very slightly not enough….we’re at about 0.34 or so at present I think?

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Mr Yan
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Mr Yan

Are you suggesting we take over the neighbours nicer house?

TD
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TD

At least have kitchen privileges and unfettered access to the fridge.

Spike
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Spike

“And we’re definitely going to [ameliorate inequality] in some sense in any human society.” But by government and the threat of armed force? A human society depending on charity to do the amelioration wouldn’t work? In fact, it did, until government crowded out charities. But study inequality on earth and believe you are devising “first principles” and you’ll have a mandate for activist government almost as compelling as “climate change.”

Bloke in Germany
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Bloke in Germany

So what you’re saying is, we’re just like crustaceans.

john77
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john77

Define what you mean by equality! When do I get to be equal to Stephen Hawkins or Andrew Wiles, let alone Jonah Lomu or Ben Stokes? If you are talking about inequality of spending power (VERY different from inequality of income) then that should definitely be non-zero as some people genuinely need to spend more than others (those restricted to public transport without a wrinkly bus pass, the chronically sick, the disabled, anyone with dietary restrictions, students living away from home …) Inequality of income – as I’m spending my savings in the form of a pension I don’t need… Read more »