Large Income Inequality

Has a direct bearing on many aspects of the quality of life..

Income inequalities and social ills

According to Kate Pickett and Richard Wilkinson in The Spirit Level: Why Greater Equality Makes Societies Stronger, income inequalities in a society are a source of a variety of social problems in that society, almost without regard to the absolute level of income in the society.

Their basic measure of inequality across countries and states in the United States is the ratio of income from the top quintile to the bottom quintile. (They also sometimes make use of the Gini coefficient.) The quintile income ratio varies across OECD countries from a low of about 4 (Japan) to a high of just under 10 (Singapore). The United States has the second highest ratio, at about 8.5 (figure 2.1).

In order to empirically evaluate the impact of a society’s income inequalities on social well-being, they construct an Index of Health and Social Problems for each country and US state. The index incorporates —

        Level of trust
        Mental illness
        Life expectancy and infant mortality
        Children’s educational performance
        Teenage births
        Imprisonment rates
        Social mobility

These ten factors are all weighted equally. Here is their most basic graph plotting the index against income inequality among OECD countries (figure 2.2):

A similar but looser relationship obtains between these variables for US states; figure 2.4. And they find similar relationships between the UNICEF index of child wellbeing and income inequality; figure 2.7. So their most basic claim is well substantiated: there is a strong negative relationship between social inequalities and social well-being. Most importantly, they maintain that this relationship is causal.

This is indeed a striking hypothesis. Their argument is not that material deprivation causes social harms and high inequality societies have more material deprivation; it is rather that the degree of inequality is itself an important cause of social harms. Further, they maintain that these relationships persist in affluent societies. And they are explicit in accepting that this implies a causal relationship between a structural feature of society and individual outcomes (chap 3).

Some of the most interesting content in the book comes in the form of specific empirical analysis of some of the kinds of social malaise that are rising in society, and some of the mechanisms through which inequalities contribute to this rise. Chapter 3 takes on stress and anxiety. Figure 3.1 documents a generally rising level of anxiety among men and women college students from the 1950s to the 1990s. The authors relate this rise to an increase in social anxieties: feelings of inadequacy, friendlessness, and separation from community (kl 745). And these features of social relationship, they believe, derive from rising hierarchy and inequality.

Another important mechanism of social harm is the erosion of trust that modern societies have experienced. This too the authors attribute to rising hierarchy and inequality and the pronounced separation this creates among members of society. Figure 4.1 illustrates this relationship.
Similar analysis and findings are presented for mental illness (chapter 5), health and life expectancy (chapter 6), obesity (chapter 7), educational performance (chapter 8), teen births (chapter 9), violence (chapter 10), rates of incarceration (chapter 11), and social mobility (chapter 12).

The data presented here are very striking: a standard set of scatter plots demonstrating a positive relationship between inequality and a variety of social harms. In each case the authors attempt to provide an account of a mechanism that plausibly leads from inequality to the higher incidence of the social harm.

It strikes me, though, that all the mechanisms amount to the same sociological idea: that extreme inequality leads to a set of psychological conditions that in turn produce the harm in question. They emphasize status differences on the one hand (inequality) and friendship on the other (equality) as powerful determinants of social well-being and harm (kl loc 2927).

Much of this argument seems to come down to some familiar hypotheses in sociology: that anomie is a social feature that produces social and individual harms (Durkheim) and that the strands of community are favorable to human wellbeing (Tonnies, Putnam). Inequalities are toxic, according to this line of argument, because they undermine the strands of social relationships and community among individuals; they produce a situation of rising anomie and separation among individuals in society. Societies with lower inequalities allow higher levels of trust and community to persist and this gives rise to fewer social problems.

It is an appealing argument, but in the end I find it monocausal and therefore less convincing than the authors would wish. I’m finding it to be “Durkheim on epidemiological steroids”. Even if we accept the point that reciprocity and mutual respect are key components of a society’s health, there are other factors that undermine these besides economic inequality — racism, ethnic hatred, sexism, and other kinds of “othering” besides income inequality. I appreciate the book. But I’d like a more multicausal analysis of the findings.

It is also interesting to ask whether the authors think there is a tipping point when it comes to inequalities. Is there a level of income inequality where inequalities are a non-factor when it comes to the social ills that they highlight? Is the level of inequality current in Sweden just fine as a foundation for social cohesion and reciprocity? Or is the situation more analogous to exposure to second-hand smoke: every level creates a risk? In other words, is it only high inequality societies that create these harms, or does every society north of Babeuf do so to some extent?