Tuesday, November 1, 2011

Local equality, national inequality, and The Spirit Level

Kate Pickett and Richard Wilkinson's The Spirit Level: Why Equality is Better for Everyone argues that countries with higher levels in income inequality tend to suffer a number of social problems like higher crime, obesity, mental illness and so on. Their book also breaks the United States down into its states and compares these, seeming to show that those states with higher income inequality suffer greater social problems.

But should we stop at state level?

I stumbled across this blog post, which argues that China is unequal mainly between its provinces, not within its provinces. That is, inequality is low in any given local area, but the wealth of each area varies widely, so inequality between regions is very high.

I cannot vouch for the accuracy of this claim but it did make me think more about the level on which inequality is visible. Pickett and Wilkinson seem to presume that the individual's awareness of inequality is strong at the level of a small to medium-sized country: the level of tens of millions of people.

But is this true?

When I was growing up in rural Ireland I had no sense of belonging to a socio-economic class, no sense of class identity, and no sense of significant income inequality in the area. There were few obvious indicators of wealth or status. There was a local council housing estate but the students who grew up there were, in my school, peers and equals to everyone else. Since the towns were small and spaced many kilometres apart, the vast majority of us simply went to the nearest school; there was no sense of a rich school or 'rough' school that would segregate the classes. I did not know what the parents of most of my classmates did for a living, it was not discussed and nobody seemed to care. We all wore school uniforms so there was little peer pressure over appearance.

If there was a sense of inequality, it was a sort of West of Ireland camaraderie and defiance towards Dublin. For example, when Dublin had major transport infrastructure projects including a light rail system (LUAS), the western counties demanded the reopening of a disused railway along the western seaboard. I remember posters reading something like: DUBLIN GETS LUAS, WHAT DOES WEST GET?

There was a sense in the west of abandonment by a Dublin-centric elite. People complained about the 'D4' media - referencing the upper-middle class Dublin postal district containing the offices of the state broadcast company. People argued that a few flakes of snow in Dublin made national news while blizzards in the west were ignored.

There was some truth to these complaints: I lived in a region with much lower wealth per person than that of Dublin. But is this the kind of income inequality that Pickett and Wilkinson were describing?

Ours was a completely different experience of inequality than that experienced in big cities. Every person I knew seemed to be of roughly equal wealth and economic status as me, so there must have been less of the everyday stress (assuming Pickett and Wilkinson are right about inequality causing stress) of being compared with the wealthy. If there was indignation towards a supposed Dublin elite, I did not notice any particular sense of shame over it.

In cities this experience must be more immediate. In Dublin I can distinguish between individuals by socio-economic class by their accent, clothes and posture. There are known wealthy suburbs and poorer 'rough' council estates. The classes rub shoulders on public transport every day, so they can see the limit of their community's identity and the higher or lower status alternative.

I don't know if Pickett and Wilkinson are correct with their claims about the negative social and health effects of wealth inequality. Supposing it is true, I do not see how it could function in the earlier description I gave, of local equality and national inequality. If the relative poor only deal with their economic equals, will they still feel a sense of insecurity and stress?

And this makes me think differently about indicators of national income inequality like the Gini coefficient. A local boom for one city could push the Gini result up, without exposing most people elsewhere to any first-hand experience of income inequality. It might be useful to keep breaking Gini scores down into smaller regions, where possible.

2 comments:

  1. This is an important point overlooked by Wilkinson and Pickett. If 'more equal societies almost always do better', what is a 'society'? Income comparisons are most likely to have a psychological impact at the local level, not the state or national level. Indeed, research shows that they only have a (mild) effect at the ultra-local level ie. amongst friends, family and neighbours. W & P look at much broader populations - US states and whole countries. Wilkinson is currently working with the borough of Islington (fittingly, for a champagne socialist), but if he succeeds in reducing inequality there, how can it benefit residents when it is, according to his book, the national rate of inequality that matters?

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  2. Thank you for the comment Chris, good points.

    Another related point I realised today is about the fact that income inequality is often lower in rural areas than in urban areas. We know that some social problems like crime are less severe in rural areas, probably because of stronger social trust or conformity in a region where individuals are known to their neighbours.

    Yet some countries have higher rural populations than others. So a graph that shows correlation between inequality and crime, may really be showing correlation between URBANISATION and crime. Without controlling for the urban/rural nature of the population, we may be misled by the data.

    Also, you have a good point that national borders make quite arbitrary 'societies'. If individuals really are stressed out that people in a distant city hundreds of miles away on the other side of the country are much richer than they, then presumably people living near a national border would also be stressed out by inequality among their close foreign neighbours. I mean, someone living on a farm in south Canada should be just as affected by the relative inequality in Chicago as he is by the relative equality across the great mass of Canada. It seems odd that one's empathy and jealousy are expected to cease at the national border!

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