The Spirit Level

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pages: 345 words: 92,849

Equal Is Unfair: America's Misguided Fight Against Income Inequality by Don Watkins, Yaron Brook

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3D printing, Affordable Care Act / Obamacare, Apple II, barriers to entry, Berlin Wall, Bernie Madoff, blue-collar work, business process, Capital in the Twenty-First Century by Thomas Piketty, Cass Sunstein, collective bargaining, colonial exploitation, corporate governance, correlation does not imply causation, Credit Default Swap, crony capitalism, David Brooks, deskilling, Edward Glaeser, Elon Musk, en.wikipedia.org, financial deregulation, immigration reform, income inequality, indoor plumbing, inventory management, invisible hand, Isaac Newton, Jeff Bezos, Jony Ive, laissez-faire capitalism, Louis Pasteur, low skilled workers, means of production, minimum wage unemployment, Naomi Klein, new economy, obamacare, Peter Singer: altruism, Peter Thiel, profit motive, rent control, Ronald Reagan, Silicon Valley, Skype, statistical model, Steve Jobs, Steve Wozniak, The Spirit Level, too big to fail, trickle-down economics, Uber for X, urban renewal, War on Poverty, women in the workforce, working poor

In Piketty’s runaway bestseller, Capital in the Twenty-First Century, the chief proposals for fighting inequality are an annual global wealth tax of up to 10 percent a year, and a self-described “confiscatory” top marginal income tax rate as high as 80 percent.12 For some, even this doesn’t go far enough. There are critics of economic inequality who are largely indifferent to its impact on opportunity and want to level down society even if it means crippling economic progress. In their popular critique of economic inequality, The Spirit Level, Richard Wilkinson and Kate Pickett tell us that “we need to limit economic growth severely in rich countries,” because “[o]nce we have enough of the necessities of life, it is the relativities which matter.”13 Similarly, best-selling author Naomi Klein argues that to truly deal with the problem of inequality, we must reject capitalism altogether, give up on the idea of economic progress, and embrace a decentralized agrarian form of socialism.14 Left-wing radio host Thom Hartmann will settle merely for banning billionaires: “I say it’s time we outlaw billionaires by placing a 100% tax on any wealth over $999,999,999.

In the race of life, according to the Rawlsian view, everyone should have a fair shot at success; just as a track meet would be unfair if some people started halfway to the finish line, so it’s critical that the government help even out the opportunities we encounter in life—to level the playing field by taking away advantages from the fortunate (e.g., huge inheritance taxes) and giving advantages to the less fortunate (e.g., government provision of health care and education).49 This idea of equality of opportunity is appealing to many people, even those untroubled by unequal economic outcomes. As the authors of The Spirit Level point out, “Unlike greater equality itself, equality of opportunity is valued across the political spectrum, at least in theory.”50 The reason it’s so appealing is that it taps in to our sense of fairness: in any game, we want everyone to play by the same rules. But life is not a game, and achieving equality of initial chances means forcing people to play by different rules. Trying to equalize initial chances of success in life requires the government to treat people unequally: in order to ensure an equal material and educational starting point, the government has to take earned money from well-to-do parents and give unearned money and education to less well-to-do parents.

Mobility is a by-product of the vitality of a free society: the only way to succeed over the long run is by continually exercising ability. Is mobility alive and well in America today? That is not an easy thing to measure, and the approach taken by the inequality critics (and most everyone today) confuses more than it clarifies. There are basically two ways researchers try to measure mobility. As Richard Wilkinson and Kate Pickett explain in their book The Spirit Level, “people can move up or down within their lifetime (intragenerational mobility) or offspring can move up and down relative to their parents (intergenerational mobility).” Note that when they say “move up and down relative to their parents,” Wilkinson and Pickett don’t mean simply that children make more money than their parents, so-called absolute mobility. When it comes to absolute mobility, the overwhelming majority of Americans today live in households that have larger real incomes than their parents had at the same age.5 What they are referring to is relative mobility: does someone make more money relative to his contemporaries than his parents made relative to their contemporaries?

 

pages: 337 words: 103,273

The Great Disruption: Why the Climate Crisis Will Bring on the End of Shopping and the Birth of a New World by Paul Gilding

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airport security, Albert Einstein, BRICs, carbon footprint, clean water, cleantech, Climategate, corporate social responsibility, decarbonisation, energy security, Exxon Valdez, failed state, fear of failure, income inequality, Joseph Schumpeter, market fundamentalism, Naomi Klein, new economy, nuclear winter, oil shock, peak oil, Ponzi scheme, purchasing power parity, Ronald Reagan, shareholder value, The Spirit Level, The Wealth of Nations by Adam Smith, union organizing, University of East Anglia

This comes from one of the most important pieces of research I’ve seen in several years, one that has substantially changed my view of how all this will unfold. Up until this point, I thought we were going to have to address poverty and inequality by a combination of moral persuasion and social imperative (to avoid local and global political instability). It appears there is another reason we should do so, one that is likely to be far more influential than moral persuasion. This new research was presented in the book The Spirit Level by Richard Wilkinson and Kate Pickett and was the result of comprehensive analysis by its authors over many years into the impact of inequality on a huge range of social indicators of progress. Its conclusions are startling. It turns out that the greatest predictor of social ills, across an incredible range of phenomena, is not the absolute level of poverty or disadvantage. It is instead the degree of inequality or income difference among people.

In the current model, we are firmly addicted at the personal level to more stuff. The problem is that the process of acquiring it, rather than actually satisfying our needs, drives a self-replicating cycle of dissatisfaction and greater want. We believe more wealth will satisfy us, but what actually happens is that the process actually drives inequality, which increases dissatisfaction, which we try to satisfy with more of the same! Research in The Spirit Level explains this with new data, confirming what has been argued by many others, like Professor Tim Kasser. It seems inequality is one of the greatest drivers to consume. Status competition drives consumption, and inequality exacerbates status competition as we try anxiously to keep up, driven by marketers who exploit our state of anxiety. On the topic of limits, marketers’ attempts to get inside our heads seem to have no boundaries.

In other words, much of our personal behavior and aspirations are driven by the desire to feel like a respectable and successful member of our community. It’s just that of late, we have come to define that by the possession of ever more material goods. This latter point is what creates the opportunity for marketers. While we cannot argue they are the cause of it, marketers exploit our tendency with very negative results, as argued in The Spirit Level, referring to Tim Kasser’s work: Young adults who focus on money, image and fame tend to be more depressed, have less enthusiasm for life and suffer more physical symptoms such as headaches and sore throats than others (The High Price of Materialism, MIT Press, 2002). Kasser believes that people tend to embrace material values when they are feeling insecure (retail therapy, anyone?). “Advertisements have become more sophisticated,” says Kasser.

 

pages: 525 words: 153,356

The People: The Rise and Fall of the Working Class, 1910-2010 by Selina Todd

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call centre, collective bargaining, conceptual framework, credit crunch, deindustrialization, deskilling, Downton Abbey, financial independence, full employment, income inequality, manufacturing employment, New Urbanism, Red Clydeside, rent control, rising living standards, strikebreaker, The Spirit Level, unemployed young men, union organizing, upwardly mobile, urban renewal, Winter of Discontent, women in the workforce, young professional

Toynbee, ‘This Bold Equality Push is Just What we Needed. In 1997’, Guardian (28 April 2009), p. 9. 57. B. Skeggs, ‘Haunted by the Spectre of Judgement: Respectability, Value and Affect in Class Relations’, in K.P. Sveinsson (ed.) and Runnymede Trust, Who Cares about the White Working Class? (London, 2009), pp. 36–44; Walkerdine, ‘Reclassifying Upward Mobility’. 58. ‘The Spirit Level’, Guardian (14 August 2010), http://www.guardian.co.uk​/books/2010/aug/14/the-spirit​-level-equality-thinktanks​?intcmp=239, (consulted 21 January 2013). 59. British Future, State of the Nation (London, 2013), p. 3. 60. BritainThinks, Middle English, p. 37. 61. ‘What is Working Class?’, BBC Magazine, http://news.bbc.co.uk​/1/hi/magazine/6295743​.stm (consulted 20 September 2013). 62. B. Skeggs, Formations of Class and Gender: Becoming Respectable (London, 1997); M.

By 2008 they owned one-third of it. Meanwhile, the least wealthy half of society – millions of pensioners, manual workers, call centre and care home staff, nurses, teaching assistants, cleaners and office workers, as well as those who couldn’t find work or were sick – lived on less than one-quarter of the national income.2 Rising inequality made people unhealthy and unhappy. In their meticulously researched The Spirit Level: Why Greater Equality Makes Societies Stronger, Richard Wilkinson and Kate Pickett reveal that as economic inequality increased, so too did anxiety disorders and depression. These rose most among the poorest, but thousands of other people, including professional, salaried workers and their children, were also suffering. Inequality, as Wilkinson and Pickett show, was bad for everyone outside the wealthiest 10 per cent.3 Faced with an increasingly insecure labour market, millions of people came to question the political orthodoxy that class was dead and that the working class had disappeared.

As the sociologists Bev Skeggs and Valerie Walkerdine have revealed, these attitudes aren’t confined to north-east England: women from working-class backgrounds whom they interviewed in southern England similarly saw their appearance and personality as determining their lives, and any failure led to low self-esteem, anxiety and depression.57 Yet as my classmates prepared to turn forty, attitudes towards class and inequality did appear to be changing in Britain. The success of The Spirit Level provided a clue: this academic study of ‘why inequality is bad for all of us’, written by two social scientists, became a surprise bestseller when it was published in 2010.58 Owen Jones’s Chavs achieved similar success a year later. Increasing numbers of people described themselves as working class. A survey by the thinktank British Future indicated that more than 60 per cent of Britons identified themselves as being working class.59 It was no coincidence that this new interest in class coincided with the first major recession for twenty years.

 

pages: 235 words: 62,862

Utopia for Realists: The Case for a Universal Basic Income, Open Borders, and a 15-Hour Workweek by Rutger Bregman

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autonomous vehicles, banking crisis, Bartolomé de las Casas, Berlin Wall, Bertrand Russell: In Praise of Idleness, Branko Milanovic, cognitive dissonance, computer age, conceptual framework, credit crunch, David Graeber, Diane Coyle, Erik Brynjolfsson, everywhere but in the productivity statistics, Fall of the Berlin Wall, Francis Fukuyama: the end of history, Frank Levy and Richard Murnane: The New Division of Labor, full employment, George Gilder, happiness index / gross national happiness, Henry Ford's grandson gave labor union leader Walter Reuther a tour of the company’s new, automated factory…, income inequality, invention of gunpowder, James Watt: steam engine, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Kevin Kelly, Kickstarter, knowledge economy, knowledge worker, Kodak vs Instagram, labour market flexibility, labour mobility, low skilled workers, means of production, megacity, meta analysis, meta-analysis, microcredit, minimum wage unemployment, Mont Pelerin Society, Nathan Meyer Rothschild: antibiotics, Occupy movement, offshore financial centre, Peter Thiel, post-industrial society, precariat, RAND corporation, randomized controlled trial, Ray Kurzweil, Ronald Reagan, Second Machine Age, Silicon Valley, Simon Kuznets, Skype, stem cell, Steven Pinker, telemarketer, The Spirit Level, The Wealth of Nations by Adam Smith, Thomas Malthus, Thorstein Veblen, Tyler Cowen: Great Stagnation, universal basic income, wage slave, War on Poverty, We wanted flying cars, instead we got 140 characters, wikimedia commons, women in the workforce, working poor, World Values Survey

., a nationwide poll showed that most Americans want society to “move away from greed and excess toward a way of life more centred on values, community and family.” Quoted in: Richard Wilkinson and Kate Pickett, The Spirit Level. Why Equality is Better for Everyone (2010) p. 4. 25. Paraphrased from the movie Fight Club, Professor of Sustainable Development Tim Jackson, and hundreds of other variations on this quote. 26. Quoted in: Don Peck, “How A New Jobless Era Will Transform America,” The Atlantic (March 2010). http://www.theatlantic.com/magazine/archive/2010/03/how-a-new-jobless-era-will-transform-america/307919/ 27. Wilkinson and Pickett, The Spirit Level, p. 34. 28. World Health Organization, “Health for the World’s Adolescents. A second chance in the second decade’ (June 2014). http://apps.who.int/iris/bitstream/10665/112750/1/WHO_FWC_MCA_14.05_eng.pdf?

.” – Steven Pinker, Johnstone Professor of Psychology, Harvard University, and author of The Blank Slate and The Better Angels of Our Nature “This book is brilliant. Everyone should read it. Bregman shows us we’ve been looking at the world inside out. Turned right way out we suddenly see fundamentally new ways forward. If we can get enough people to read this book, the world will start to become a better place.” – Richard Wilkinson, co-author of The Spirit Level: Why More Equal Societies Almost Always Do Better “Rutger Bregman makes a compelling case for Universal Basic Income with a wealth of data and rooted in a keen understanding of the political and intellectual history of capitalism. He shows the many ways in which human progress has turned a Utopia into a Eutopia – a positive future that we can achieve with the right policies.” – Albert Wenger, entrepreneur and partner at Union Square Ventures, early backers of Twitter, Tumblr, Foursquare, Etsy, and Kickstarter “Learning from history and from up-to-date social science can shatter crippling illusions.

., by contrast, people are less likely (as the World Values Survey shows) to consider their successes a product of luck or circumstance. 22. Jonathan D. Ostry, Andrew Berg, and Charalambos G. Tsangarides, “Redistribution, Inequality, and Growth,” IMF (April 2014). http://www.imf.org/external/pubs/ft/sdn/2014/sdn1402.pdf 23. Wilkinson and Pickett’s findings caused quite a stir, but since the publication of The Spirit Level there have been dozens more studies confirming their thesis. In 2011, the Joseph Rowntree Foundation conducted an independent analysis of their evidence, and concluded that there is indeed wide scientific consensus on the correlation between inequality and social problems. And, crucially, there is also a sizeable share of data to support causality. See: Karen Rowlingson, “Does income inequality cause health and social problems?”

 

pages: 504 words: 143,303

Why We Can't Afford the Rich by Andrew Sayer

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accounting loophole / creative accounting, Albert Einstein, asset-backed security, banking crisis, banks create money, Bretton Woods, British Empire, call centre, capital controls, carbon footprint, collective bargaining, corporate social responsibility, credit crunch, Credit Default Swap, crony capitalism, David Graeber, David Ricardo: comparative advantage, debt deflation, decarbonisation, declining real wages, deglobalization, deindustrialization, delayed gratification, demand response, don't be evil, Double Irish / Dutch Sandwich, en.wikipedia.org, Etonian, financial innovation, financial intermediation, Fractional reserve banking, full employment, Goldman Sachs: Vampire Squid, high net worth, income inequality, investor state dispute settlement, Isaac Newton, James Dyson, job automation, Julian Assange, labour market flexibility, laissez-faire capitalism, low skilled workers, Mark Zuckerberg, market fundamentalism, Martin Wolf, means of production, moral hazard, mortgage debt, neoliberal agenda, new economy, New Urbanism, Northern Rock, Occupy movement, offshore financial centre, oil shale / tar sands, patent troll, payday loans, Plutocrats, plutocrats, predatory finance, price stability, pushing on a string, quantitative easing, race to the bottom, rent-seeking, Ronald Reagan, shareholder value, short selling, sovereign wealth fund, Steve Jobs, The Nature of the Firm, The Spirit Level, The Wealth of Nations by Adam Smith, Thorstein Veblen, too big to fail, transfer pricing, trickle-down economics, universal basic income, unpaid internship, upwardly mobile, Washington Consensus, Winter of Discontent, working poor, Yom Kippur War

According to WHO figures, over 20 per cent of the populations of the more unequal rich countries are likely to suffer forms of mental illness – such as depression, anxiety disorders, drug or alcohol addiction – each year. Rates may be three times as high as in the most equal countries. At the same time, measures of the strength of community life and whether people feel they can trust others also show that more equal societies do very much better. As discussed in The Spirit Level (Penguin, 2010), tackling inequality is an important step towards achieving sustainability and high levels of well-being. As the populations of the developed world have gained unprecedented standards of comfort and material prosperity, further increases in those standards make less and less difference to well-being. But what has become critical to well-being is the social environment and the quality of social relations.

To be sure, there are substantial minorities – growing in the recession – of people with incomes below the threshold, and for whom more money would definitely improve their lives significantly. Indeed, anxiety about making ends meet can put relationships under stress, and cause shame and mental illness. So redistribution of income and power from the rich and affluent to those on low incomes would produce an overall net improvement in well-being. Richard Wilkinson and Kate Pickett’s influential book, The Spirit Level, also shows that insatiable acquisitiveness is not the route to well-being. Rather than rely just on people’s own assessments of their happiness, it looks at data on things like life expectancy, health, violence, crime, education, trust and social mobility.22 Again, they find that once average incomes in countries reach a certain point, further increases make little difference to well-being as measured by indicators of these things.

Levels of trust vary widely between countries. The percentage of people who say “Most people can be trusted” is only 30 per cent of people in the U.K. and U.S., compared to 60 per cent some 40 years ago. But in Scandinavia the level is still over 60 per cent, and these are the happiest countries too.’24 Figure 20.1: Health and social problems are worse in more unequal countries Source: Wilkinson, R. and Pickett, K. (2009) The spirit level, London: Allen Lane Happiness research shows that whether people are happy tends to depend first on what they’re used to, and on how they compare to others – on habituation and social comparison, in other words.25 The habituation effect is like a ratchet: as income rises, so too do our ideas about what we need in order to be happy – except that beyond the threshold we don’t actually gain much.

 

pages: 309 words: 86,909

The Spirit Level: Why Greater Equality Makes Societies Stronger by Richard Wilkinson; Kate Pickett

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Berlin Wall, clean water, Diane Coyle, epigenetics, experimental economics, experimental subject, Fall of the Berlin Wall, full employment, germ theory of disease, Gini coefficient, impulse control, income inequality, knowledge economy, labor-force participation, land reform, Louis Pasteur, meta analysis, meta-analysis, Milgram experiment, offshore financial centre, phenotype, Plutocrats, plutocrats, profit maximization, profit motive, Ralph Waldo Emerson, statistical model, The Chicago School, The Spirit Level, The Wealth of Nations by Adam Smith, Thorstein Veblen, ultimatum game, upwardly mobile, World Values Survey

RICHARD WILKINSON AND KATE PICKETT The Spirit Level Why Greater Equality Makes Societies Stronger BLOOMSBURY PRESS New York Berlin London Contents Foreword Preface Acknowledgements Note on Graphs PART ONE Material Success, Social Failure 1 The end of an era 2 Poverty or inequality? 3 How inequality gets under the skin PART TWO The Costs of Inequality 4 Community life and social relations 5 Mental health and drug use 6 Physical health and life expectancy 7 Obesity: wider income gaps, wider waists 8 Educational performance 9 Teenage births: recycling deprivation 10 Violence: gaining respect 11 Imprisonment and punishment 12 Social mobility: unequal opportunities PART THREE A Better Society 13 Dysfunctional societies 14 Our social inheritance 15 Equality and sustainability 16 Building the future Appendix References Foreword ROBERT B.

A few worry that it cuts off opportunities among the children of the poor for productive lives—but whether to distribute wealth more equally, or what might be gained from doing so, is a topic all but ignored by today’s economic researchers. It has taken two experts from the field of public health to deliver a major study of the effects of inequality on society. Though Richard Wilkinson and Kate Pickett are British, their research explores the United States in depth, and their work is an important contribution to the debate our country needs. The Spirit Level looks at the negative social effects of wide inequality—among them, more physical and mental illness not only among those at the lower ranks, but even those at the top of the scale. The authors find, not surprisingly, that where there are great disparities in wealth, there are heightened levels of social distrust. They argue convincingly that wide inequality is bad for a society, and that more equal societies tend to do better on many measures of social health and wealth.

It creates a new aristocracy whose privileges perpetuate themselves over generations (one of the striking findings in these pages is that America now has less social mobility than many poorer countries). And it breeds cynicism among the rest of us. This is not to say that the superrich are at fault. By and large, “the market” is generating these outlandish results. But the market is a creation of public policies. And public policies, as the authors make clear, can reorganize the market to reverse these trends. The Spirit Level shows why the effort to do so is a vital one for the health of our society. Berkeley, California July 2009 Preface People usually exaggerate the importance of their own work and we worry about claiming too much. But this book is not just another set of nostrums and prejudices about how to put the world to rights. The work we describe here comes out of a very long period of research (over fifty person-years between us) devoted, initially, to trying to understand the causes of the big differences in life expectancy – the ‘health inequalities’ – between people at different levels in the social hierarchy in modern societies.

 

pages: 317 words: 101,475

Chavs: The Demonization of the Working Class by Owen Jones

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Asperger Syndrome, banking crisis, Berlin Wall, British Empire, call centre, collapse of Lehman Brothers, credit crunch, deindustrialization, Etonian, facts on the ground, falling living standards, first-past-the-post, ghettoisation, Gini coefficient, hiring and firing, housing crisis, Hugh Fearnley-Whittingstall, illegal immigration, income inequality, informal economy, low skilled workers, low-wage service sector, Occupy movement, pension reform, place-making, Plutocrats, plutocrats, race to the bottom, rising living standards, The Bell Curve by Richard Herrnstein and Charles Murray, The Spirit Level, too big to fail, unpaid internship, upwardly mobile, We are the 99%, Winter of Discontent, women in the workforce, working-age population

Liam Cranley, the son of a factory worker who grew up in a working-class community in Greater Manchester, describes to me his reaction when a middle-class person uses the word: 'You're talking about family: you're talking about my brother, you're talking about my mum. You're talking about my friends.' This book will look at how chav-hate is far from an isolated phenomenon. In part, itis the product of a deeply unequal society. 'In my view, one of the key effects of greater inequality is toincrease feelings of superiority and inferiority in society,' says Richard Wilkinson, coauthor of the seminal The Spirit Level, a book that effectively demonstrates thelinkbetween inequality and a range of social problems. And indeed inequality is much greater today than it has been for most of our history. 'A widespread inequality is an extremely recent thing for most of the world,' argues the professor of human geography and' inequality expert', Danny Dorling. Demonizing people at the bottom has been a convenient way of justifying an unequal society throughout the ages.

'I wouldn't try and do anything about correcting the inequalities,' he explained, 'because the inequalities are widened by people getting richer, not by the poor getting poor-but by the rich getting richer. And frankly, so long as they generate wealth for the economy, so long as they generate tax income and so on, then I'm comfortable with it.' I pointed out the recent groundbreaking research by academics Richard Wilkinson and Kate Pickett in their book, The Spirit Level. They used irrefutable statistics to show that the more unequal a society is, the more social problems it has-like crime and poor health, for example. In other words, more equal societies were happier societies. David Davis gave the book short shrift. 'It's bullshit,' he said. 'It's bullshi: ... I think it's one of these fashionable, stupid ideas. It's easy to sell a book, but Idon't think it stands up.'

There is little real pressure to stop them amassing huge riches while their employees' wages stagnate or even decline. At the heart of this scandal is the destruction of the power of workers as an organized force-that is, the trade unions. 'There are studies that show that one of the features of more equal societies is stronger trade union movements,' says Professor Richard Wilkinson, co-author of seminal book The Spirit Level. I think the ability of people at the top, the bankers and chief executives and so on, to give themselves these huge bonuses reflects the fact they're in a situation where there are no constraints on them. If there were strong trade unions and perhaps a union or employee representative on the company's board, it would become more embarrassing for CEOs to award themselves huge pay increases and bonuses while holding down wage demands from employees.

 

pages: 523 words: 111,615

The Economics of Enough: How to Run the Economy as if the Future Matters by Diane Coyle

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accounting loophole / creative accounting, affirmative action, bank run, banking crisis, Berlin Wall, bonus culture, Branko Milanovic, BRICs, call centre, Cass Sunstein, central bank independence, collapse of Lehman Brothers, conceptual framework, corporate governance, correlation does not imply causation, Credit Default Swap, deindustrialization, demographic transition, Diane Coyle, disintermediation, Edward Glaeser, Eugene Fama: efficient market hypothesis, experimental economics, Fall of the Berlin Wall, Financial Instability Hypothesis, Francis Fukuyama: the end of history, George Akerlof, Gini coefficient, global supply chain, Gordon Gekko, greed is good, happiness index / gross national happiness, Hyman Minsky, If something cannot go on forever, it will stop, illegal immigration, income inequality, income per capita, invisible hand, Jane Jacobs, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, labour market flexibility, low skilled workers, market bubble, market design, market fundamentalism, megacity, Network effects, new economy, night-watchman state, Northern Rock, oil shock, principal–agent problem, profit motive, purchasing power parity, railway mania, rising living standards, Ronald Reagan, Silicon Valley, South Sea Bubble, Steven Pinker, The Design of Experiments, The Fortune at the Bottom of the Pyramid, The Market for Lemons, The Myth of the Rational Market, The Spirit Level, transaction costs, transfer pricing, tulip mania, ultimatum game, University of East Anglia, web application, web of trust, winner-take-all economy, World Values Survey

CONSEQUENCES OF INEQUALITY FOR WELL-BEING In the absence of any evidence on the impact on growth per se, what about evidence of the impact of inequality on more direct measures of well-being? Some researchers are passionate advocates of a causal link between increased inequality and worse outcomes in a wide range of social indicators, from health and life expectancy to teenage pregnancy and crime. In their recent book The Spirit Level, Richard Wilkinson and Kate Pickett make exactly this argument and what’s more suggest that in an unequal society even the people at the top of the pile in terms of income have a reduced level of welfare compared to their counterparts in more equal places. Much of their evidence consists of presenting simple correlations between measures of inequality in different countries and measures of some social bad such a depression rates or prevalence of heart disease.

Jorgenson, Dale W., and Kevin J. Stiroh. 2000. “Raising the Speed Limit: U.S. Economic Growth in the Information Age.” Brookings Papers on Economic Activity 1, pp. 125–211. Kaletsky, Anatole. 2010. Capitalism 4.0. London: Bloomsbury. Kamarck, Elaine. 2003. “Government Innovation around the World.” Cambridge, MA: John F Kennedy School of Government, Harvard University. Kay, John. 2009a. “Review of The Spirit Level.” Financial Times, 23 March 2009. ———. 2009b. “Labour’s Love Affair with Bankers Is to Blame for This Sorry State.” Financial Times, 25 April 2009. ———. 2010. Obliquity. London: Profile. Keefer, P., and S. Knack. 1997. “Does Social Capital Have An Economic Payoff? A Cross-Country Investigation.” Quarterly Journal of Economics 112, pp. 1251–88. Khor, Martin. 2010. “Blame Failure of Copenhagen Summit on Denmark, not China,” China Daily, 2 January.

“International Migration Report.” New York: Department of Economic and Social Affairs/Population Division, United Nations. Waal, Frans de. 2008. Primates and Philosophers: How Morality Evolved. Princeton: Princeton University Press. Weale, Martin. 2009. “Saving and the National Economy.” Discussion Paper No. 340. London: National Institute of Economic and Social Research. Wilkinson, Richard, and Kate Pickett. 2009. The Spirit Level: Why More Equal Societies Almost Always Do Better. London: Allen Lane. Wilkinson, Will. 2007. “In Pursuit of Happiness Research: Is it Reliable? What Does It Imply for Policy.” Policy Analysis, No. 590, 11 April 2007, Washington DC: Cato Institute. Willetts, David. 2010. The Pinch. London: Atlantic Books. Winterson, Jeanette. 2010. “Once upon a Life.” Observer Magazine, 13 June, pp. 7–10.

 

pages: 385 words: 111,807

A Pelican Introduction Economics: A User's Guide by Ha-Joon Chang

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Affordable Care Act / Obamacare, Albert Einstein, Asian financial crisis, asset-backed security, bank run, banking crisis, banks create money, Berlin Wall, bilateral investment treaty, borderless world, Bretton Woods, British Empire, call centre, capital controls, central bank independence, collateralized debt obligation, colonial rule, Corn Laws, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, David Ricardo: comparative advantage, deindustrialization, discovery of the americas, Eugene Fama: efficient market hypothesis, eurozone crisis, experimental economics, Fall of the Berlin Wall, falling living standards, financial deregulation, financial innovation, Francis Fukuyama: the end of history, Frederick Winslow Taylor, full employment, George Akerlof, Gini coefficient, global value chain, Goldman Sachs: Vampire Squid, Gordon Gekko, greed is good, Haber-Bosch Process, happiness index / gross national happiness, high net worth, income inequality, income per capita, interchangeable parts, interest rate swap, inventory management, invisible hand, Isaac Newton, James Watt: steam engine, Johann Wolfgang von Goethe, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, joint-stock company, joint-stock limited liability company, Joseph Schumpeter, knowledge economy, laissez-faire capitalism, land reform, manufacturing employment, Mark Zuckerberg, market clearing, market fundamentalism, Martin Wolf, means of production, Mexican peso crisis / tequila crisis, Northern Rock, obamacare, offshore financial centre, oil shock, open borders, post-industrial society, precariat, principal–agent problem, profit maximization, profit motive, purchasing power parity, quantitative easing, road to serfdom, Robert Shiller, Robert Shiller, Ronald Coase, Ronald Reagan, savings glut, Scramble for Africa, shareholder value, Silicon Valley, Simon Kuznets, sovereign wealth fund, spinning jenny, structural adjustment programs, The Great Moderation, The Market for Lemons, The Spirit Level, The Wealth of Nations by Adam Smith, Thorstein Veblen, trade liberalization, transaction costs, transfer pricing, trickle-down economics, Washington Consensus, working-age population, World Values Survey

Inequality leads to inferior social outcomes Recently, studies have come out to show that inequality leads to poor outcomes in health and other social indicators of human well-being. And this is independently of the sheer effect of higher inequality producing a higher number of poor people, who are bound to perform worse in these regards. This argument has been made popular recently by the book The Spirit Level, by Richard Wilkinson and Kate Pickett. The book examined the data from two dozen or so rich countries (roughly countries with per capita incomes above the level of Portugal, which is around $20,000). It argues that more unequal countries definitely do worse in terms of infant mortality, teenage births, educational performance, homicide and imprisonment, and also possibly in terms of life expectancy, mental illness and obesity.3 More egalitarian societies have grown faster in many cases Not only is there a lot of evidence showing that higher inequality produces more negative economic and social outcomes, there are quite a few examples of more egalitarian societies growing much faster than comparable but more unequal societies.4 During their ‘miracle’ years between the 1950s and the 1980s, Japan, South Korea and Taiwan grew much faster than comparable countries despite having lower inequalities.

HULME Global Poverty: How Global Governance Is Failing the Poor (London: Routledge, 2010). B. MILANOVIC The Haves and the Have-Nots (New York: Basic Books, 2011). A. SEN Development as Freedom (Oxford: Oxford University Press, 2001). J. STIGLITZ The Price of Inequality (London: Allen Lane, 2012). D. STUCKLER AND S. BASU The Body Economic: Why Austerity Kills (London: Basic Books, 2013). R. WILKINSON AND K. PICKETT The Spirit Level: Why Equal Societies Almost Always Do Better (London: Allen Lane, 2009). ‘Lady Glossop: Do you work, Mr Wooster? Bertie: What, work, as in honest toil, you mean? Lady Glossop: Yes. Bertie: Hewing the wood and drawing the old wet stuff and so forth? Lady Glossop: Quite. Bertie: Well, I’ve known a few people who’ve worked. Absolutely swear by it, some of them.’ JEEVES AND WOOSTER, BBC SERIES, SEASON 1, EPISODE 1, ‘JEEVES’ ARRIVAL’ Work Work as the defining condition of humanity For Bertie Wooster – the kind-hearted but clueless aristocratic dandy (played by a young Hugh Laurie of House fame) in the 1980s BBC TV adaptation of P.

See OECD, Divided We Stand: Why Inequality Keeps Rising (Paris: Organization for Economic Cooperation and Development, 2011), and ILO, World of Work 2012 (Geneva: International Labour Organization, 2012). 10. The following Gini coefficients are for 2010 from ILO, World of Work 2012, p. 15, figure 1.9. Figures for Botswana and Namibia are from older sources. 11. Interestingly, the dividing line here is similar to what some of the friendly critics of The Spirit Level use when they say that inequality produces negative social outcomes in countries above a certain level of inequality. 12. UNCTAD, Trade and Development Report 2012 (Geneva: United Nations Conference on Trade and Development, 2012), Chapter 3, p. 66, chart 3.6. The fifteen countries studied were Australia, Canada, Chile, China, Germany, India, Indonesia, Italy, Japan, (South) Korea, New Zealand, Norway, Thailand, the UK and the US.

 

pages: 317 words: 87,566

The Happiness Industry: How the Government and Big Business Sold Us Well-Being by William Davies

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1960s counterculture, Airbnb, business intelligence, Cass Sunstein, corporate governance, dematerialisation, experimental subject, Exxon Valdez, Frederick Winslow Taylor, Gini coefficient, income inequality, invisible hand, joint-stock company, market bubble, mental accounting, nudge unit, profit maximization, randomized controlled trial, Richard Thaler, road to serfdom, Ronald Coase, Ronald Reagan, science of happiness, sentiment analysis, sharing economy, Slavoj Žižek, smart cities, Smart Cities: Big Data, Civic Hackers, and the Quest for a New Utopia, Steve Jobs, The Chicago School, The Spirit Level, theory of mind, urban planning

In 2007, three UK education authorities sent 100 British teachers to visit the Penn Resilience Project, so as to recreate it in the UK. 6‘Work for World Peace Starting Now – Google’s “Jolly Good Fellow” Can Help’, huffingtonpost.com, 27 March 2012. 7Sarah Knapton, ‘Stressed Council House Residents Get £2,000 Happiness Gurus’, telegraph.co.uk, 9 October 2008. 8Fabienne Picard, Didier Scavarda and Fabrice Bartolomei, ‘Induction of a Sense of Bliss by Electrical Stimulation of the Anterior Insula’, Cortex 49: 10, 2013; ‘Pain “Dimmer Switch” Discovered by UK Scientists’, bbc.com, 5 February 2014. 9Gary Wolf, ‘Measuring Mood: Current Research and New Ideas’, quantifiedself.com, 11 February 2009. 10Friedrich Nietzsche, Twilight of the Idols and The Anti-Christ, New York: Penguin, 1990, 33. 11Campbell and Simmons, ‘At Davos, Rising Stress Spurs Goldie Hawn Meditation Talk’. 12See Richard Wilkinson and Kate Pickett, The Spirit Level: Why More Equal Societies Almost Always Do Better, London: Allen Lane, 2009. Work by Carles Muntaner explores this issue further. 13Gallup, State of the Global Workplace Report 2013, 2013 14Adam Kramer, Jamie Guillory and Jeffrey Hancock, ‘Experimental Evidence of Massive-Scale Emotional Contagion Through Social Networks’, Proceedings of the National Academy of the Sciences 111: 24, 2014. 15F.

Michael Hardt and Antonio Negri, Empire, Cambridge, MA: Harvard University Press, 2000; Adam Arvidsson and Nicolai Peitersen, The Ethical Economy: Rebuilding Value After the Crisis, New York: Columbia University Press, 2014; Jeremy Gilbert, Common Ground: Democracy and Collectivity in an Age of Individualism, London: Pluto Press, 2014. 5 The Crisis of Authority 1‘Full Text: Blair’s Newsnight Interview’, theguardian.com, 21 April 2005. 2Richard Wilkinson and Kate Pickett, The Spirit Level. 3ESPNcricinfo staff, ‘We Urge the Development of Inner Fitness’, espncricinfo.com, 1 April 2014. 4‘Competitiveness and Perfectionism: Common Traits of Both Athletic Performance and Disordered Eating’, medicalnewstoday.com, 22 May 2009. 5Tim Kasser, The High Price of Materialism, Cambridge, MA: MIT Press, 2003. 6See Toben Nelson et al., ‘Do Youth Sports Prevent Pediatric Obesity? A Systematic Review and Commentary’, Current Sports Medicine Reports 10: 6, 2011. 7This is according to the Gini coefficient. 8Kim Phillips-Fein, Invisible Hands: The Making of the Conservative Movement from the New Deal to Reagan, New York: W.

Not If the Algorithms Say You’re Not’, smithsonianmag.com, 27 August, 2013. 21Cass Sunstein, ‘Shopping Made Psychic’, nytimes.com, 20 August 2014. 22Rian Boden, ‘Alfa-Bank Uses Activity Trackers to Offer Higher Interest Rates to Customers Who Exercise’, nfcworld.com, 30 May 2014. 23‘Moscow Subway Station Lets Passengers Pay Fare in Squats’, forbes.com, 14 November 2013. 8 Critical Animals 1Lizzie Davies and Simon Rogers, ‘Wellbeing Index Points Way to Bliss: Live on a Remote Island, and Don’t Work’, theguardian.com, 24 July 2012. 2Cari Nierenberg, ‘A Green Scene Sparks Our Creativity’, bodyodd.nbcnews.com, 28 March 2012. 3In Spring 2011, the British Psychological Society published an open letter, authored by clinical psychologists, criticizing the DSM-V. 4See Richard Wilkinson and Kate Pickett, The Spirit Level. 5One calculation produced by the British happiness economist Andrew Oswald suggests that an unemployed person would need benefits of £250,000 a year to compensate them for the negative psychological impact of unemployment. 6Sally Dickerson and Margaret Kemeny, ‘Acute Stressors and Cortisol Responses: A Theoretical Integration and Synthesis of Laboratory Research’, Psychological Bulletin 130: 3, 2004; Robert Karasek and Tores Theorell, Healthy Work: Stress, Productivity, and the Reconstruction of Working Life, New York: Basic Books, 1992. 7Ronald McQuaid et al., ‘Fit for Work: Health and Wellbeing of Employees in Employee Owned Businesses’, employeeownership.co.uk, 2012. 8David Stuckler and Sanjay Basu, The Body Economic: Why Austerity Kills, New York: HarperCollins, 2013. 9See the CIPD Absence Management Annual Survey, cipd.co.uk, 2013. 10Tim Kasser and Aaron Ahuvia, ‘Materialistic Values and Well-Being in Business Students’, European Journal of Social Psychology 32: 1, 2002. 11Miriam Tatzel, M.

 

pages: 440 words: 108,137

The Meritocracy Myth by Stephen J. McNamee

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affirmative action, Affordable Care Act / Obamacare, Bernie Madoff, British Empire, collective bargaining, computer age, conceptual framework, corporate governance, deindustrialization, delayed gratification, demographic transition, desegregation, deskilling, equal pay for equal work, estate planning, failed state, fixed income, gender pay gap, Gini coefficient, glass ceiling, helicopter parent, income inequality, informal economy, invisible hand, job automation, joint-stock company, labor-force participation, low-wage service sector, marginal employment, Mark Zuckerberg, mortgage debt, mortgage tax deduction, new economy, New Urbanism, obamacare, occupational segregation, pink-collar, Plutocrats, plutocrats, Ponzi scheme, post-industrial society, prediction markets, profit motive, race to the bottom, random walk, school choice, Scientific racism, Steve Jobs, The Bell Curve by Richard Herrnstein and Charles Murray, The Spirit Level, The Wealth of Nations by Adam Smith, too big to fail, trickle-down economics, upwardly mobile, We are the 99%, white flight, young professional

Bureau of Labor Statistics. http://www.bls.gov/news.release/pdf/cfoi.pdf (accessed January 14, 2013). Van Leeuwen, Marco, Ineke Mass, and Andrew Miles, eds. 2006. Marriage Choices and Class Boundaries: Social Endogamy in History. International Review of Social History Supplement 13. Cambridge, UK: University of Cambridge. Weitz, Rose. 2013. The Sociology of Health, Illness, and Health Care: A Critical Approach. Boston: Wadsworth. Wilkinson, Richard, and Kate Pickett. 2009. The Spirit Level: Why Greater Equality Makes Societies Stronger. New York: Bloomsbury Press. Willenbacher, Barbara. 2003. “Individualism and Traditionalism in Inheritance Law in Germany, France, England, and the United States.” Journal of Family History 28, no. 1: 208–25. ———. 2012. “The Asset Price Meltdown and the Wealth of the Middle Class.” New York: New York University. Wilson, William Julius. 1987.

Changes of this magnitude would require reductions in socially structured inequality, especially inequalities of wealth and power. How could such change be brought about? There are several policy options, all of which depend on the will of those in charge. In the final analysis, policy is determined by the outcome of political contests. These contests reflect competing visions regarding what kind of society people think we ought to have or what is desirable. In the book The Spirit Level: Why Greater Equality Makes Societies Stronger (2009), epidemiologists Richard Wilkinson and Kate Pickett provide compelling cross-cultural evidence showing that countries with high levels of economic inequality are associated with a variety of what most would agree are undesirable outcomes such as poor physical health (including lower levels of life expectancy and higher rates of infant mortality), higher rates of stress and mental illness, higher rates of drug abuse, lower levels of overall childhood well-being (as well as higher rates of childhood obesity, lower levels of student math and literacy scores, and higher teenage rates of pregnancy), higher levels of violence (including homicide rates), higher rates of incarceration, and lower levels of social mobility.

Warren, Elizabeth, and Amelia Warren Tyagi. 2003. The Two-Income Trap: Why Middle-Class Mothers and Fathers Are Going Broke. New York: Basic Books. Waters, Mary C. 2012. “Racial and Ethnic Diversity and Public Policy.” In The New Guilded Age: The Critical Inequality Debates of Our Time, ed. David B. Grusky and Tamar Kricheli-Katz, 230–46. Stanford, CA: Stanford University Press. Wilkinson, Richard, and Kate Pickett. 2009. The Spirit Level: Why Greater Equality Makes Societies Stronger. New York: Bloomsbury Press. Wilson, William Julius. 1987. The Truly Disadvantaged: The Inner City, the Underclass, and Public Policy. Chicago: University of Chicago Press. Winant, Howard. 2012. “A Dream Deferred: Toward a U.S. Racial Future.” In The New Gilded Age: The Critical Inequality Debates of Our Time, ed. David B. Grusky and Tamar Kricheli-Katz, 211–29.

 

When the Money Runs Out: The End of Western Affluence by Stephen D. King

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Albert Einstein, Asian financial crisis, asset-backed security, banking crisis, Basel III, Berlin Wall, Bernie Madoff, British Empire, capital controls, central bank independence, collapse of Lehman Brothers, collateralized debt obligation, congestion charging, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, cross-subsidies, debt deflation, Deng Xiaoping, Diane Coyle, endowment effect, eurozone crisis, Fall of the Berlin Wall, financial innovation, financial repression, floating exchange rates, full employment, George Akerlof, German hyperinflation, Hyman Minsky, income inequality, income per capita, inflation targeting, invisible hand, John Maynard Keynes: Economic Possibilities for our Grandchildren, joint-stock company, liquidationism / Banker’s doctrine / the Treasury view, liquidity trap, London Interbank Offered Rate, loss aversion, market clearing, moral hazard, mortgage debt, new economy, New Urbanism, Nick Leeson, Northern Rock, Occupy movement, oil shale / tar sands, oil shock, price mechanism, price stability, quantitative easing, railway mania, rent-seeking, reserve currency, rising living standards, South Sea Bubble, sovereign wealth fund, technology bubble, The Market for Lemons, The Spirit Level, The Wealth of Nations by Adam Smith, Thomas Malthus, Tobin tax, too big to fail, trade route, trickle-down economics, Washington Consensus, women in the workforce, working-age population

At the opposite end of the spectrum, Turkey, Mexico and Portugal have low levels of trust, low living standards and high levels of income inequality. It would seem to follow, then, that reducing income inequality should raise levels of trust and, at the very least, make societies a bit happier. 158 4099.indd 158 29/03/13 2:23 PM Three Schisms Plenty of people have been happy to make the argument. In The Spirit Level, Richard Wilkinson and Kate Pickett argue powerfully in favour of greater equality, concluding: We know that greater equality will help us rein in consumerism and ease the introduction of policies to tackle global warming. We can see how the introduction of modern technology makes profit-­making institutions appear increasingly anti-­social as they find themselves threatened by the rapidly expanding potential for public good which new technology offers . . .

In this respect, he has something in common with the family of George Osborne, the Chancellor of the Exchequer.   3. S. Schama, Citizens: A Chronicle of the French Revolution (Knopf, New York, 1989).   4. Specifically, King James II was deposed, the risk of a Catholic monarchy was reduced, William and Mary took the throne and Parliament reigned supreme.   5. R. Wilkinson and K. Pickett, The Spirit Level: Why Equality Is Better for Everyone (Allen Lane, London, 2009).   6. See F. Roth, ‘Trust and Economic Growth: Conflicting Results between Cross-­Sectional and Panel Analysis’, Program on the Future of the European Social Model, Göttingen, 2007. 269 4099.indd 269 29/03/13 2:23 PM Notes to pp. 161–194   7. ‘Economy Rankings’, Doing Business Project: Measuring Business Regulations, International Finance Corporation/World Bank, 2012, at http://www.doingbusiness. org/rankings/ (accessed Jan. 2013).   8.

On the Eve: The Jews of Europe before the Second World War, Profile Books, London, 2012 Weber, Max. The Protestant Work Ethic and the Spirit of Capitalism: The Revised 1920 Edition, trans. and updated by Stephen Kalberg, Oxford University Press, Oxford, 2011 Weinberg, D. H. ‘US Neighbourhood Income Inequality in the 2005–2009 Period’, American Community Survey Reports, United States Census Bureau, Washington, DC, Oct. 2011 Wilkinson, R. and Pickett, K. The Spirit Level: Why Equality Is Better for Everyone, Allen Lane, London, 2009 277 4099.indd 277 29/03/13 2:23 PM When the Money Runs Out Wood, J. and Berg, P. ‘Rebuilding Trust in Banks’, Gallup Business Journal, at http://businessjournal.gallup.com/content/148049/rebuilding-­trust-­banks.aspx#2 (accessed Jan. 2013) Yellen, J. ‘Housing Bubbles and Monetary Policy’, Speech to the Fourth Haas Gala, Federal Reserve Bank of San Francisco, San Francisco, 21 Oct. 2005 Yellen, J.

 

pages: 179 words: 43,441

The Fourth Industrial Revolution by Klaus Schwab

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3D printing, additive manufacturing, Airbnb, Amazon Mechanical Turk, Amazon Web Services, augmented reality, autonomous vehicles, barriers to entry, Baxter: Rethink Robotics, bitcoin, blockchain, Buckminster Fuller, call centre, clean water, collaborative consumption, conceptual framework, continuous integration, crowdsourcing, disintermediation, distributed ledger, Edward Snowden, Elon Musk, epigenetics, Erik Brynjolfsson, future of work, global value chain, Google Glasses, income inequality, Internet Archive, Internet of things, invention of the steam engine, job automation, job satisfaction, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, life extension, Lyft, megacity, meta analysis, meta-analysis, more computing power than Apollo, mutually assured destruction, Narrative Science, Network effects, Nicholas Carr, personalized medicine, precariat, precision agriculture, Productivity paradox, race to the bottom, randomized controlled trial, reshoring, RFID, rising living standards, Second Machine Age, secular stagnation, self-driving car, sharing economy, Silicon Valley, smart cities, smart contracts, software as a service, Stephen Hawking, Steve Jobs, Steven Levy, Stuxnet, The Spirit Level, total factor productivity, transaction costs, Uber and Lyft, Watson beat the top human players on Jeopardy!, WikiLeaks, winner-take-all economy, women in the workforce, working-age population, Y Combinator, Zipcar

According to Credit Suisse’s Global Wealth Report 2015, half of all assets around the world are now controlled by the richest 1% of the global population, while “the lower half of the global population collectively own less than 1% of global wealth”.53 The Organisation for Economic Co-operation and Development (OECD) reports that the average income of the richest 10% of the population in OECD countries is approximately nine times that of the poorest 10%.54 Further, inequality within most countries is rising, even in those that have experienced rapid growth across all income groups and dramatic drops in the number of people living in poverty. China’s Gini Index, for example, rose from approximately 30 in the 1980s to over 45 by 2010.55 Rising inequality is more than an economic phenomenon of some concern – it is a major challenge for societies. In their book The Spirit Level: Why Greater Equality Makes Societies Stronger, British epidemiologists Richard Wilkinson and Kate Pickett put forward data indicating that unequal societies tend to be more violent, have higher numbers of people in prison, experience greater levels of mental illness and obesity, and have lower life expectancies and lower levels of trust. The corollary, they found, is that, after controlling for average incomes, more equal societies have higher levels of child well-being, lower levels of stress and drug use, and lower infant mortality.56 Other researchers have found that higher levels of inequality increase segregation and reduce educational outcomes for children and young adults.57 While the empirical data are less certain, there are also widespread fears that higher levels of inequality lead to higher levels of social unrest.

http://publications.credit-suisse.com/tasks/render/file/index.cfm?fileid=F2425415-DCA7-80B8-EAD989AF9341D47E 54 OECD, “Divided We Stand: Why Inequality Keeps Rising”, 2011. http://www.oecd.org/els/soc/49499779.pdf 55 Frederick Solt, “The Standardized World Income Inequality Database,” Working paper, SWIID, Version 5.0, October 2014. http://myweb.uiowa.edu/fsolt/swiid/swiid.html 56 Richard Wilkinson and Kate Pickett, The Spirit Level: Why Greater Equality Makes Societies Stronger, Bloomsbury Press, 2009. 57 Sean F. Reardon and Kendra Bischoff, “More unequal and more separate: Growth in the residential segregation of families by income, 1970-2009”, US 2010 Project, 2011. http://www.s4.brown.edu/us2010/Projects/Reports.htm http://cepa.stanford.edu/content/more-unequal-and-more-separate-growth-residential-segregation-families-income-1970-2009 58 Eleanor Goldberg, “Facebook, Google are Saving Refugees and Migrants from Traffickers”, Huffington Post, 10 September 2015.

 

pages: 414 words: 119,116

The Health Gap: The Challenge of an Unequal World by Michael Marmot

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active transport: walking or cycling, Affordable Care Act / Obamacare, Atul Gawande, Bonfire of the Vanities, Broken windows theory, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, Celtic Tiger, centre right, clean water, congestion charging, correlation does not imply causation, Doha Development Round, epigenetics, financial independence, future of work, Gini coefficient, Growth in a Time of Debt, illegal immigration, income inequality, Indoor air pollution, Kenneth Rogoff, Kibera, labour market flexibility, lump of labour, Mahatma Gandhi, meta analysis, meta-analysis, microcredit, New Urbanism, obamacare, paradox of thrift, race to the bottom, Rana Plaza, RAND corporation, road to serfdom, Simon Kuznets, Socratic dialogue, structural adjustment programs, the built environment, The Spirit Level, trickle-down economics, urban planning, Washington Consensus, Winter of Discontent, working poor

You are all pulling against each other. I have the impression that in Japan they are all on the same team. There is, in Japan, a shared commitment to success. We see it in relatively narrow income inequalities, low rates of poverty, low rates of crime, care for older people – and the longest life expectancy in the world. Richard Wilkinson and Kate Pickett captured public imagination with their book The Spirit Level.27 It contains a simple and powerful idea: inequalities of income damage the health and well-being of all of us, rich, poor, or somewhere in between. I have co-edited books with Richard Wilkinson, and co-written a paper defending his ideas against some of his critics. I agree that social and economic inequalities are bad for health inequalities. There is a ‘but’. The evidence that income inequalities are bad for the health of everyone in society was seen only among richer countries, and that evidence is weaker now than it was.

Striking it Richer: The Evolution of Top Incomes in the United States (Updated with 2012 preliminary estimates) 2013 [14/04/2014]. Available from: http://elsa.berkeley.edu/~saez/saez-UStopincomes-2012.pdf. 18OECD. OECD Stat Extracts: Income Distribution and Poverty – Poverty rate after taxes and transfers, poverty line 60% 2013 [14/04/2014]. Available from: http://stats.oecd.org/Index.aspx?DataSetCode=IDD. 19Galbraith JK. The Affluent Society. New York: Houghton Mifflin Company, 1998. 20Wilkinson RG, Pickett K. The Spirit Level: Why More Equal Societies Almost Always Do Better. London: Allen Lane, 2009. 21Lewis M. The Big Short: Inside the Doomsday Machine. London: Allen Lane, 2011. 22Hampshire S. Justice Is Conflict. Princeton NJ: Princeton University Press, 2000. 23New Policy Institute, MacInnes T, Aldridge H, Bushe S, Kenway P, Tinson A. Monitoring Poverty and Social Exclusion 2013. Joesph Rowntree Foundation, 2013. 24Hacker J, Pierson P.

International Business Times. 6 January 2013. 24Rutter J, Stocker K. Childcare Costs Survey 2014. Family and Childcare Trust, 2014. 25Ferguson D. The costs of childcare: how Britain compares with Sweden. The Guardian. 31 May 2014. 26Mackenbach JP. The persistence of health inequalities in modern welfare states: The explanation of a paradox. Social Science & Medicine. 2012; 75(4): 761–9. 27Wilkinson RG, Pickett K. The Spirit Level: Why More Equal Societies Almost Always Do Better. London: Allen Lane, 2009. 28Marmot MG, Sapolsky R. Of Baboons and Men: Social Circumstances, Biology, and the Social Gradient in Health. In: Weinstein M, Lane MA, editors. Sociality, Hierarchy, Health: Comparative Biodemography: A Collection of Papers. Washington DC: National Academies Press, 2014. 10 LIVING FAIRLY IN THE WORLD 1Yang J.

 

pages: 515 words: 132,295

Makers and Takers: The Rise of Finance and the Fall of American Business by Rana Foroohar

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3D printing, accounting loophole / creative accounting, additive manufacturing, Airbnb, algorithmic trading, Asian financial crisis, asset allocation, bank run, Basel III, bonus culture, Bretton Woods, British Empire, call centre, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, carried interest, centralized clearinghouse, clean water, collateralized debt obligation, corporate governance, corporate social responsibility, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, crowdsourcing, David Graeber, deskilling, Detroit bankruptcy, diversification, Double Irish / Dutch Sandwich, Emanuel Derman, Eugene Fama: efficient market hypothesis, financial deregulation, financial intermediation, Frederick Winslow Taylor, George Akerlof, gig economy, Goldman Sachs: Vampire Squid, Gordon Gekko, greed is good, High speed trading, Home mortgage interest deduction, housing crisis, Howard Rheingold, Hyman Minsky, income inequality, index fund, interest rate derivative, interest rate swap, Internet of things, invisible hand, joint-stock company, joint-stock limited liability company, Kenneth Rogoff, knowledge economy, labor-force participation, labour mobility, London Whale, Long Term Capital Management, manufacturing employment, market design, Martin Wolf, moral hazard, mortgage debt, mortgage tax deduction, new economy, non-tariff barriers, offshore financial centre, oil shock, passive investing, pensions crisis, Ponzi scheme, principal–agent problem, quantitative easing, quantitative trading / quantitative finance, race to the bottom, Ralph Nader, Rana Plaza, RAND corporation, random walk, rent control, Robert Shiller, Robert Shiller, Ronald Reagan, Second Machine Age, shareholder value, sharing economy, Silicon Valley, Silicon Valley startup, Snapchat, sovereign wealth fund, Steve Jobs, technology bubble, The Chicago School, The Spirit Level, The Wealth of Nations by Adam Smith, Tim Cook: Apple, Tobin tax, too big to fail, trickle-down economics, Tyler Cowen: Great Stagnation, Vanguard fund

William Lazonick, “Profits Without Prosperity,” Harvard Business Review 92, no. 2 (September 2014). 55. James K. Galbraith and Travis Hale, “Income Distribution and the Information Technology Bubble,” Working Paper No. 27, University of Texas Inequality Project, January 2004. 56. Robert Frank, The High-Beta Rich: How the Manic Wealthy Will Take Us to the Next Boom, Bubble, and Bust (New York: Crown Business, 2011), 54. 57. Richard Wilkinson and Kate Pickett, The Spirit Level: Why Equality Is Better for Everyone (London: Penguin Books, 2009). 58. Rana Foroohar, “Thomas Piketty: Marx 2.0,” Time, May 19, 2014. 59. Federal Reserve Flow of Funds; Congressional Research Service, “Rebuilding Household Wealth: Implications for Economic Recovety,” by Craig K. Elwell, September 13, 2013. 60. Reinhart and Rogoff, This Time Is Different, 156. 61. Charles P. Kindleberger and Robert Z.

Cecchetti and Enisse Kharroubi, “Reassessing the Impact of Finance on Growth,” Working Paper No. 381, Bank for International Settlements, July 2012. 9. Mian and Sufi, House of Debt. 10. Turner, Between Debt and the Devil. 11. Robert J. Shiller, Finance and the Good Society (Princeton, NJ: Princeton University Press, 2012). 12. Mian and Sufi, House of Debt. 13. For an interesting discussion of alternative models, see chapter 16 of Richard Wilkinson and Kate Pickett, The Spirit Level: Why Equality Is Better for Everyone (New York: Penguin Books, 2009). 14. Asker, Farre-Mensa, and Ljungqvist, “Comparing the Investment Behavior of Public and Private Firms.” 15. Fareed Zakaria, The Post-American World (New York: Norton, 2012). 16. Rana Foroohar, “What Hasn’t Been Fixed Since the Last Market Crash?” Time, August 27, 2015. See also Ken Miller, “The China Bubble,” Time, October 31, 2011. 17.

USB White Paper for the World Economic Forum. January, 2015. Warren, Elizabeth. A Fighting Chance. New York: Picador, 2015. Weill, Sandy, and Judah S. Kraushaar. The Real Deal: My Life in Business and Philanthropy. New York: Warner Business Books, 2006. Whitney, Meredith. Fate of the States: The New Geography of American Prosperity. New York: Penguin Press, 2013. Wilkinson, Richard, and Kate Pickett. The Spirit Level: Why Equality Is Better for Everyone. London: Penguin Books, 2009. Wolf, Martin. The Shifts and the Shocks: What We’ve Learned—and Have Still to Learn—from the Financial Crisis. New York: Penguin Press, 2014. Zingales, Luigi. A Capitalism for the People: Recapturing the Lost Genius of American Prosperity. New York: Basic Books, 2012. Zweig, Phillip L. Wriston: Walter Wriston, Citibank, and the Rise and Fall of American Financial Supremacy.

 

pages: 309 words: 91,581

The Great Divergence: America's Growing Inequality Crisis and What We Can Do About It by Timothy Noah

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autonomous vehicles, blue-collar work, Bonfire of the Vanities, Branko Milanovic, call centre, collective bargaining, computer age, corporate governance, Credit Default Swap, David Ricardo: comparative advantage, Deng Xiaoping, Erik Brynjolfsson, feminist movement, Frank Levy and Richard Murnane: The New Division of Labor, Gini coefficient, income inequality, industrial robot, invisible hand, job automation, Joseph Schumpeter, low skilled workers, lump of labour, manufacturing employment, moral hazard, oil shock, pattern recognition, performance metric, positional goods, post-industrial society, postindustrial economy, purchasing power parity, refrigerator car, rent control, Richard Feynman, Richard Feynman, Ronald Reagan, shareholder value, Silicon Valley, Simon Kuznets, Stephen Hawking, Steve Jobs, The Spirit Level, too big to fail, trickle-down economics, Tyler Cowen: Great Stagnation, union organizing, upwardly mobile, very high income, War on Poverty, We are the 99%, women in the workforce, Works Progress Administration, Yom Kippur War

Is it my imagination, or do we hear less criticism of such societies today in the United States? Might it be harder for Americans, as gated communities spread across the land while middle-class enclaves disappear, to sustain in such discussions the necessary sense of moral superiority? That income inequality weighs heavily on the noneconomic life of a nation is the thesis of the 2009 book The Spirit Level by Richard Wilkinson and Kate Pickett, two medical researchers based in Yorkshire, England. The book has been criticized for overreaching. Wilkinson and Pickett relate income inequality trends not only to mental and physical health, violence, and teenage pregnancy, but also to global warming. But their larger point—that income inequality is bad not only for people on the losing end but also for society at large—is indisputable.

A Nation at Risk: The Imperative for Educational Reform, National Commission on Excellence in Education (Washington: Education Department, 1983). Raghuram G. Rajan, Fault Lines: How Hidden Fractures Still Threaten the World Economy (Princeton, NJ: Princeton University Press, 2010). John Rawls, A Theory of Justice (Cambridge, MA: Harvard University Press, 1971). Andy Stern, A Country That Works: Getting America Back on Track (New York: Free Press, 2008; originally published in 2006). Richard Wilkinson and Kate Pickett, The Spirit Level: Why Greater Equality Makes Societies Stronger (New York: Bloomsbury, 2009). 1. Trends in the Distribution of Household Income, Congressional Budget Office, 19. 2. Warren Buffett, “Stop Coddling the Super-Rich,” New York Times, Aug. 14, 2011, at http://www.nytimes.com/2011/08/15/opinion/stop-coddling-the-super-rich.html; “Options to Tax Individuals with Incomes over $1 Million,” Table T11-0302, Tax Policy Center (Washington: Brookings Institution, 2011), at http://www.taxpolicycenter.org/numbers/Content/PDF/T11-0302.pdf; “Monthly Budget Review,” Congressional Budget Office, Nov, 7, 2011, at http://www.cbo.gov/ftpdocs/125xx/doc12541/2011_Nov_MBR.pdf. 3.

 

pages: 223 words: 10,010

The Cost of Inequality: Why Economic Equality Is Essential for Recovery by Stewart Lansley

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banking crisis, Basel III, Big bang: deregulation of the City of London, Bonfire of the Vanities, borderless world, Branko Milanovic, Bretton Woods, British Empire, business process, call centre, capital controls, collective bargaining, corporate governance, correlation does not imply causation, credit crunch, Credit Default Swap, crony capitalism, David Ricardo: comparative advantage, deindustrialization, Edward Glaeser, falling living standards, financial deregulation, financial innovation, Financial Instability Hypothesis, floating exchange rates, full employment, Goldman Sachs: Vampire Squid, high net worth, hiring and firing, Hyman Minsky, income inequality, James Dyson, Jeff Bezos, job automation, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, laissez-faire capitalism, Long Term Capital Management, low skilled workers, manufacturing employment, market bubble, Martin Wolf, mittelstand, mobile money, Mont Pelerin Society, new economy, Nick Leeson, North Sea oil, Northern Rock, offshore financial centre, oil shock, Plutocrats, plutocrats, Plutonomy: Buying Luxury, Explaining Global Imbalances, rising living standards, Robert Shiller, Robert Shiller, Ronald Reagan, savings glut, shareholder value, The Great Moderation, The Spirit Level, The Wealth of Nations by Adam Smith, Thomas Malthus, too big to fail, Tyler Cowen: Great Stagnation, Washington Consensus, Winter of Discontent, working-age population

Although recent years have seen several hard-hitting, and hotly debated, critiques of this deepening gulf, these have concentrated on issues of social injustice and fairness. Rewards at the top of finance and business, their authors argue, have become increasingly disproportionate and undeserving, the product of an increase in the concentration of political and market power rather than a greater economic contribution.2 One of the most influential of these critiques, The Spirit Level, has shown that highly unequal societies are much more likely to impose widespread social damage.3 These are important arguments but they deal mainly with the moral and social consequences of the surge in polarisation. An equally important issue, but one that has been largely ignored, is the impact of soaring inequality on the way economies function. This is the issue addressed in this book.

A failure to act risks a new phase of permanent or near-permanent recession, one that will condemn much of the population—in the UK, the US and elsewhere—to a prolonged period of depressed wages, stagnant living standards and blighted opportunities. Notes 2 See, for example, W Hutton, Them and Us, Little Brown, 2010; D Dorling, Injustice, Policy Press, 2010; G Irvin, Super Rich, Polity Press, 2008; P Toynbee & D Walker, Unjust Rewards, Granta, 2008; S Lansley, Rich Britain, Politico’s, 2006. 3 R Wilkinson and K Pickett, The Spirit Level, Penguin, 2009. 1 AN ECONOMIC MEGASHIFT Thirty years ago, the United Kingdom was one of the most equal countries in the developed world. Today it is one of the most unequal. 4 This shift started at the beginning of the 1980s and put into reverse a half century of political and social change that had reduced the gap between the top and the bottom to its lowest level in history. This egalitarian drive began in the aftermath of the great stock market crash of 1929, a time of global economic upheaval.

 

pages: 297 words: 89,206

Social Class in the 21st Century by Mike Savage

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call centre, Capital in the Twenty-First Century by Thomas Piketty, Clapham omnibus, Corn Laws, deindustrialization, deskilling, Downton Abbey, financial independence, gender pay gap, Gini coefficient, income inequality, Mark Zuckerberg, megacity, New Urbanism, Occupy movement, precariat, psychological pricing, The Spirit Level, unpaid internship, upwardly mobile, very high income, winner-take-all economy, young professional

People do not want to show off. Nor do they want to recognize the shame and stigma of being at the bottom. Yet, despite people’s hesitancies about identifying themselves economically, we will insist on the centrality of such inequalities in shaping people’s lives. The power of income inequalities Income inequalities in Britain are very high, and have been rapidly increasing. In their highly influential book The Spirit Level, Richard Wilkinson and Kate Pickett use the standard metric to measure inequality between countries – the Gini coefficient – in the fifteen states who were members of the European Union prior to its major enlargement in 2004 and also the major industrial English-speaking countries of Australia, Canada and the USA.2 Figure 2.1 gives an indication of the inequalities within nations as they reflect the relative differences between countries in terms of earnings.

MacDonald, C. Webster and K. Garthwaite, Poverty and Insecurity: Life in Low-pay No-pay, Britain (Bristol: 2012). CONCLUSION: THE OLD NEW POLITICS OF CLASS IN THE TWENTY-FIRST CENTURY 1. Anthony Crosland, The Future of Socialism (London: 1956), p. 237. 2. Thomas Piketty, Capital in the Twenty-first Century (Cambridge, MA: 2014), Chapter 14. 3. See, notably, Richard Wilkinson and Kate Pickett, The Spirit Level: Why More Equal Societies Almost Always Do Better (London: 2009). 4. See Nigel Thrift, Knowing Capitalism (London: 2005). 5. See Imogen Tyler, Revolting Subjects (London: 2013); T. Shildrick, R. MacDonald, C. Webster and K. Garthwaite, Poverty and Insecurity: Life in Low-pay, No-pay Britain (Bristol: 2012); Beverley Skeggs, Class, Self, Culture (London: 2004); and John Hills, Good Times, Bad Times: The Welfare Myth of Them and Us (Bristol: 2015).

 

pages: 285 words: 86,174

Twilight of the Elites: America After Meritocracy by Chris Hayes

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affirmative action, Affordable Care Act / Obamacare, asset-backed security, barriers to entry, Berlin Wall, Bernie Madoff, carried interest, Climategate, Climatic Research Unit, collapse of Lehman Brothers, collective bargaining, Credit Default Swap, dark matter, David Brooks, David Graeber, deindustrialization, Fall of the Berlin Wall, financial deregulation, fixed income, full employment, George Akerlof, hiring and firing, income inequality, Jane Jacobs, jimmy wales, Julian Assange, Mark Zuckerberg, mass affluent, means of production, meta analysis, meta-analysis, moral hazard, Naomi Klein, Nate Silver, peak oil, Plutocrats, plutocrats, Ponzi scheme, Ralph Waldo Emerson, rolodex, The Spirit Level, too big to fail, University of East Anglia, We are the 99%, WikiLeaks, women in the workforce

Three decades later, that percentage was 80 percent. But among those who assert their own self-worth, psychologists found two distinct personality types. One group are those who report high self-esteem and also high levels of happiness, fulfilling friendships, and social relations. The other group report high self-esteem but also display a host of antisocial tendencies, including violence, racism, and lack of empathy. In their book The Spirit Level, authors Richard Wilkinson and Kate Pickett describe this latter kind of self-esteem as “primarily defensive, a kind of internal attempt to talk oneself up”: People with insecure high self-esteem tend to be insensitive to others and to show an excessive preoccupation with themselves, with success, and with their image and appearance in the eyes of others. This unhealthy high self-esteem is often called “threatened egotism,” “insecure high self-esteem,” or narcissism.

Esquire, January 18, 2011. 41 “And I—I mean—you know, my dad”: See “Republican Presidential Candidates Participate in a CNN-Sponsored Debate,” Political Transcript Wire, January 20, 2012. 42 “It was always a business where you had to have an edge”: Steve Fishman, “The Madoff Tapes,” New York, February 27, 2011. 43 “I am an important person”: Jean M. Twenge et al., “Egos Inflating Over Time: A Cross-Temporal Meta-Analysis of the Narcissistic Personality Disorder,” Journal of Personality 76, no. 4 (2008): 878. 44 “People with insecure high self-esteem”: Kate Pickett and Richard Wilkinson, The Spirit Level: Why Greater Equality Makes Societies Stronger (New York: Bloomsbury), p. 37. 45 “not that smart and kind of a bully”: See Jeffrey Rosen, “The Case Against Sotomayor,” New Republic, May 4, 2009. 46 “meritocratic feedback loop”: Ho, Liquidated, p. 57. 47 “There’s 100 percent no question”: Author interview. 48 “the outstretched arms of J.P. Morgan’s H.R. department”: Matthew L. Siegel, “Dress for Success: The I-Banker Has No Clothes,” Harvard Crimson, October 30, 2003. 49 “the most powerful man you’ve never heard of”: Chitra Ragavan, “Cheney’s Guy,” U.S.

 

pages: 151 words: 38,153

With Liberty and Dividends for All: How to Save Our Middle Class When Jobs Don't Pay Enough by Peter Barnes

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Alfred Russel Wallace, banks create money, Buckminster Fuller, collective bargaining, David Ricardo: comparative advantage, declining real wages, deindustrialization, diversified portfolio, en.wikipedia.org, Fractional reserve banking, full employment, hydraulic fracturing, income inequality, Jaron Lanier, John Maynard Keynes: Economic Possibilities for our Grandchildren, Joseph Schumpeter, land reform, Mark Zuckerberg, Network effects, oil shale / tar sands, profit maximization, quantitative easing, rent-seeking, Ronald Coase, Ronald Reagan, Silicon Valley, sovereign wealth fund, the map is not the territory, The Spirit Level, The Wealth of Nations by Adam Smith, Thorstein Veblen, transaction costs, Tyler Cowen: Great Stagnation, Upton Sinclair, winner-take-all economy

The best Internet source for information about economic inequality in America is http://inequality.org. The data for figure 2.1 (the most recent available) were taken from Edward N. Wolff, “The Asset Price Meltdown and the Wealth of the Middle Class,” National Bureau of Economic Research Working Paper No. 18559 (November 2012), table 2, 58. 2. See especially Richard Wilkinson and Kate Pickett, The Spirit Level: Why Greater Equality Makes Societies Stronger (New York: Bloomsbury Press, 2009), 49 ff. 3. US Census Bureau, http://www.census.gov/hhes/www/income/data/historical/household/, table H-6, and http://www.census.gov/hhes/www/income/data/historical/people/, table P-8. 4. James Madison, National Gazette, March 3, 1792, http://www.brainyquote.com/quotes/authors/j/james_madison.html. 5. Alexis de Tocqueville, Democracy in America (1835), Book II, chapter 18, http://xroads.virginia.edu/~Hyper/DETOC/ch2_18.htm. 6.

 

pages: 151 words: 30,411

One Good Turn: A Natural History of the Screwdriver and the Screw by Witold Rybczynski

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invention of movable type, The Spirit Level, traveling salesman

A Roman builder, or mensor aedificorum, was familiar with the try square, the plumb line, and the chalk line—all tools that were developed by the ancient Egyptians.3 The level, or libella, also an Egyptian invention, consisted of a wood frame resembling the letter A, with a plumb bob suspended from the apex. To level, the string was lined up with a mark in the center of the crossbar. Not as compact as my spirit level, perhaps, but obviously just as serviceable since A-levels continued to be used until the mid-1800s. The spirit level, with its sealed tube containing an air bubble floating in alcohol, was invented in the mid-1600s. It was first exclusively a surveying instrument—it took another two hundred years to find its way into the carpenter’s toolbox. For measuring length, the Roman mensor used a regula, or a wooden stick divided into feet, palms, twelfths or unciae (whence our inches), and digiti or finger widths.

 

pages: 487 words: 151,810

The Social Animal: The Hidden Sources of Love, Character, and Achievement by David Brooks

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Albert Einstein, asset allocation, Atul Gawande, Bernie Madoff, business process, Cass Sunstein, choice architecture, clean water, Daniel Kahneman / Amos Tversky, David Brooks, delayed gratification, deliberate practice, disintermediation, Donald Trump, Douglas Hofstadter, Emanuel Derman, en.wikipedia.org, fear of failure, financial deregulation, financial independence, Flynn Effect, George Akerlof, Henri Poincaré, hiring and firing, impulse control, invisible hand, Joseph Schumpeter, labor-force participation, loss aversion, medical residency, meta analysis, meta-analysis, Monroe Doctrine, Richard Thaler, risk tolerance, Robert Shiller, Robert Shiller, school vouchers, six sigma, Steve Jobs, Steven Pinker, the scientific method, The Spirit Level, The Wealth of Nations by Adam Smith, Thorstein Veblen, transaction costs, Walter Mischel, young professional

It will be harder for them to be polite toward a boss who drives them crazy, to smile openly when they meet a new person, to present a consistent face to the world, even as they go through different moods and personal crises. They’ll find it hard to develop a fundamental faith in self-efficacy—a belief that they can shape the course of their life. They’ll be less likely to have confidence in the proposition that cause leads to effect, that if they sacrifice now, something good will result. Then there are the psychic effects of inequality itself. In their book The Spirit Level, Richard Wilkinson and Kate Pickett argue that the mere fact of being low on the status totem pole brings its own deep stress and imposes its own psychic costs. Inequality and a feeling of exclusion causes social pain, which leads to more obesity, worse health outcomes, fewer social connections, more depression and anxiety. Wilkinson and Pickett point, for example, to a study of British civil servants.

18 Public-education spending Eric Hanushek, “Milton Friedman’s Unfinished Business,” Hoover Digest, Winter 2007, http://edpro.stanford.edu/hanushek/admin/pages/files/uploads/friedmanhoover_digest.pdf. 19 A mother with two kids Haskins and Sawhill, 46. 20 If you read part Margaret Bridges, Bruce Fuller, Russell Rumberger, and Loan Tran, “Preschool for California’s Children: Unequal Access, Promising Benefits,” PACE Child Development Projects, University of California Linguistic Minority Research Institute (September 2004): 9, http://gse.berkeley.edu/research/pace/reports/PB.04-3.pdf. 21 About half the students Haskins and Sawhill, 223. 22 Isabel Sawhill has calculated Haskins and Sawhill, 42. 23 If you get married before Haskins and Sawhill, 70. 24 Wilkinson and Pickett point Richard Wilkinson and Kate Pickett, The Spirit Level: Why Greater Equality Makes Societies Stronger (London: Bloomsbury Press, 2009), 75 25 “Low-income families” Haskins and Sawhill, 101. 26 As James Heckman argues James Heckman and Dimitriy V. Masterov, “The Productivity Argument for Investing in Young Children,” Invest in Kids Working Group, Committee for Economic Development, Working Paper 5 (October 4, 2004): 3, http://jenni.uchicago.edu/Invest/FILES/dugger_2004-12-02_dvm.pdf. 27 But social and emotional skills Heckman and Masterov, 28–35. 28 Small classes may be better Malcolm Gladwell, “Most Likely to Succeed,” The New Yorker, December 15, 2008, http://www.newyorker.com/reporting/2008/12/15/081215fa_fact_gladwell. 29 The City University of New York Marc Santora, “CUNY Plans New Approach to Community College,” New York Times, January 26, 2009, http://www.nytimes.com/2009/01/26/education/26college.html?

 

pages: 432 words: 124,635

Happy City: Transforming Our Lives Through Urban Design by Charles Montgomery

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2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, agricultural Revolution, American Society of Civil Engineers: Report Card, Bernie Madoff, British Empire, Buckminster Fuller, car-free, carbon footprint, centre right, City Beautiful movement, clean water, congestion charging, correlation does not imply causation, East Village, edge city, energy security, Enrique Peñalosa, experimental subject, Frank Gehry, Google Earth, happiness index / gross national happiness, Home mortgage interest deduction, housing crisis, income inequality, income per capita, invisible hand, Jane Jacobs, license plate recognition, McMansion, means of production, megacity, Menlo Park, meta analysis, meta-analysis, mortgage tax deduction, New Urbanism, peak oil, Ponzi scheme, rent control, ride hailing / ride sharing, risk tolerance, science of happiness, Seaside, Florida, Silicon Valley, the built environment, The Death and Life of Great American Cities, the High Line, The Spirit Level, The Wealth of Nations by Adam Smith, trade route, transit-oriented development, upwardly mobile, urban planning, urban sprawl, wage slave, white flight, World Values Survey, Zipcar

As biologist and neuroscientist Robert Sapolsky puts it, “the disease consequences of feeling poor are often rooted in the psychosocial consequences of being made to feel poor by one’s surroundings.” If you’ve got food and a roof over your head, the worst part of poverty may in fact be the feeling of being poorer than other people. Big gaps in socioeconomic status can mean trouble for society in general. In their book, The Spirit Level: Why Greater Equality Makes Societies Stronger, British epidemiologists Richard Wilkinson and Kate Pickett demonstrate how gross inequality can lead to higher rates of violent crime, drug use, children born to teenagers, and heart disease. “If you fail to avoid high inequality, you will need more prisons and more police,” they warn governments. “You will have to deal with higher rates of mental illness, drug abuse and every other kind of problem.”* Some economists argue that status gaps are so harmful that we should treat them like pollution and use the tax system to close them.

“psychosocial consequences”: Adler, Nancy, Elissa Epel, Grace Castellazzo, and Jeannette Ickovics, “Relationship of Subjective and Objective Social Status with Psychological and Physiological Functioning: Preliminary Data in Healthy White Women,” Health Psychology, 2000: 586–92. Status comparisons: Layard, Richard, Happiness: Lessons from a New Science (London: Penguin/Allen Lane, 2005), 43–48. higher rates of mental illness: Wilkinson, Richard, and Kate Pickett, The Spirit Level: Why Greater Equality Makes Society Stronger (London: Bloomsbury, 2009). This may be part of the reason: Harris, Gregory, “Liberal or Tory, Minority Gov’t Would Hit ‘Sweet Spot,’ Profs Say,” University of Calgary press release, January 18, 2006, www.ucalgary.ca/mp2003/news/jan06/third-way.html (accessed January 12, 2011); Helliwell, John F., Globalization and Well-Being (Vancouver: UBC Press, 2002).

 

pages: 488 words: 150,477

Lemon Tree: An Arab, a Jew, and the Heart of the Middle East by Sandy Tolan

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Albert Einstein, British Empire, colonial rule, en.wikipedia.org, facts on the ground, illegal immigration, indoor plumbing, The Spirit Level, Yom Kippur War

"Progress Report of the United Nations Mediator on Palestine Submitted to the Secretary-General for Transmission to the Members of the United Nations." UNI-SPAL. http://domino.un.Org/UNISPAL.NSF/0/abl4d4aafc4elbb985256204004f55 fa?OpenDocument. "Progress Report of the United Nations Mediator on Palestine." UNISPAL. http:// domino.un.org/UNISPAL.NSF/O/cc33602f61b0935c8025648800368307? Document. Remnick, David. "Profiles: The Spirit Level: Amos Oz Writes the Story of Israel." The New Yorker. http://www.newyorker.com/fact/content/P04ll08fa_fact. Shlaim, Avi. "Israel and the Arab Coalition in 1948." Cambridge University Press. http://www.fathom.com/course/72810001. "The Law of Return 5710 (1950)." Knesset, http://www.knesset.gov.il/laws/special/ "The Law of Return 5710 (1950)." Knesset, http://www.knesset.gov.il/laws/special/ eng/return.htm.

Bashir recalled his arrest on September 17, 1967, and a stay of "one hundred days"; this would have meant his release in late December. Oz and his colleagues produced The Seventh Day: Soldiers' Talk About the Six-Day War, a book aimed at "recording in permanent form the effect of the Six-Day War on their generation." The soldiers' stories and quotes are taken from it. Oz's early stance against the occupation is documented by David Remnick in his New Yorker article "The Spirit Level," November 8, 2004. The remainder of the chapter—Dalia and Richard's arrival in Ramallah, their reception by the Khairi family, and the encounter between Dalia and Bashir—is recounted according to their memories, as described at the beginning of the notes for this chapter. Chapter 10 This chapter is based on a combination of eyewitness interviews, memoirs, secondary sources describing the historical and political context of the day, and interviews with various actors among the Palestinian political factions from 1969 to the mid-1980s.

 

pages: 221 words: 55,901

The Globalization of Inequality by François Bourguignon

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Berlin Wall, Branko Milanovic, Capital in the Twenty-First Century by Thomas Piketty, collective bargaining, Credit Default Swap, deglobalization, deindustrialization, Doha Development Round, Edward Glaeser, European colonialism, Fall of the Berlin Wall, financial deregulation, financial intermediation, gender pay gap, Gini coefficient, income inequality, income per capita, labor-force participation, minimum wage unemployment, offshore financial centre, open economy, purchasing power parity, race to the bottom, Robert Gordon, Simon Kuznets, structural adjustment programs, The Spirit Level, too big to fail, very high income, Washington Consensus

The reason I did not mention it, however, is that unfortunately the evidence to support that hypothesis is rather weak. There is indeed a relationship between income inequality and the mean health status of a population. But it could be due exclusively to the fact that on the one hand there is a correlation between individual health and income, and, on the other hand, it tends to disappear for high incomes. Thus, in one society 14  A similar hypothesis is proposed in Richard Wilkinson and Kate Pickett, The Spirit Level: Why Equality Is Better for Everyone (New York: Penguin Books, 2009). Globalization and Costly Inequality141 where rich people are richer and poor people poorer than in another society, rich people have the same health status but poor people are less healthy. On average, health is worse in the more unequal society. The same kind of correlation with income inequality may be observed for all types of behavior linked in some nonlinear way to income.

 

pages: 411 words: 80,925

What's Mine Is Yours: How Collaborative Consumption Is Changing the Way We Live by Rachel Botsman, Roo Rogers

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Airbnb, barriers to entry, Bernie Madoff, bike sharing scheme, Buckminster Fuller, carbon footprint, Cass Sunstein, collaborative consumption, collaborative economy, Community Supported Agriculture, credit crunch, crowdsourcing, dematerialisation, disintermediation, en.wikipedia.org, experimental economics, George Akerlof, global village, Hugh Fearnley-Whittingstall, information retrieval, iterative process, Kevin Kelly, Kickstarter, late fees, Mark Zuckerberg, market design, Menlo Park, Network effects, new economy, new new economy, out of africa, Parkinson's law, peer-to-peer lending, Ponzi scheme, pre–internet, recommendation engine, RFID, Richard Stallman, ride hailing / ride sharing, Robert Shiller, Robert Shiller, Ronald Coase, Search for Extraterrestrial Intelligence, SETI@home, Simon Kuznets, Skype, slashdot, smart grid, South of Market, San Francisco, Stewart Brand, The Nature of the Firm, The Spirit Level, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, Thorstein Veblen, Torches of Freedom, transaction costs, traveling salesman, ultimatum game, Victor Gruen, web of trust, women in the workforce, Zipcar

In the Bubble: Designing in a Complex World (MIT Press, 2006). Thaler, Richard, and Cass R. Sunstein. Nudge: Improving Decisions About Health, Wealth, and Happiness (Penguin, 2009). Tomasello, Michael. Why We Cooperate (MIT Press, 2009). Turner, Fred. From Counterculture to Cyberculture: Stewart Brand, the Whole Earth Network, and the Rise of Digital Utopianism (University of Chicago Press, 2006). Wilkinson, Richard, and Kate Pickett. The Spirit Level: Why Greater Equality Makes Societies Stronger (Bloomsbury Press, 2009). Index The pagination of this electronic edition does not match the edition from which it was created. To locate a specific passage, please use the search feature of your e-book reader. accelerated spending access, ownership vs. advertising Age of Access, The Aguiton, Christoph Airbnb Alexander, James All Consuming (Lawson) alternative currencies Amazon American Beauty Anderson, Chris Anderson, James Anderson, Ray Andrews, Giles Apple Architecture for Participation Arieff, Allison Arkenberg, Chris Art of Happiness in Market Economies, The (Lane) Atwood, Margaret Axelrod, Robert Baekeland, Leo Baeklite Bag Borrow or Steal Bank of Happiness Banounou, Jill Bartercard bartering see also swap trading Basel Convention Bass, Ilan B-cycle Beal, Deron Be A Martian Beckstrom, Rod belief in the commons see also commons-based society Benkler, Yochai Bernays, Edward bike sharing see also specific companies BIXI Blecharczyk, Nathan Blockbuster BlockChalk Boesel, Greg Bollier, David Bortzfield, Harold Boutin, Paul Bowling Alone (Putnam) Brafman, Ori Brainwash Launderette brand communities see also user communities brand evangelists brands Braungart, Michael Brave New World (Huxley) Brewer, Marilynn Broderick, Damien Brosnan, Sarah F.

 

pages: 208 words: 67,582

What About Me?: The Struggle for Identity in a Market-Based Society by Paul Verhaeghe

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Berlin Wall, call centre, cognitive dissonance, deskilling, epigenetics, Fall of the Berlin Wall, Francis Fukuyama: the end of history, income inequality, invisible hand, jimmy wales, job satisfaction, knowledge economy, knowledge worker, Louis Pasteur, market fundamentalism, Milgram experiment, new economy, post-industrial society, Richard Feynman, Richard Feynman, Silicon Valley, stem cell, The Spirit Level, ultimatum game, working poor

The Protestant Ethic and the Spirit of Capitalism. New York: Norton, 2009. Westen, D., Novotny, C. & Thompson-Brenner, H. ‘The Empirical Status of Empirically Supported Psychotherapies: assumptions, findings, and reporting in controlled clinical trials’. Psychological Bulletin, 2004, 130 (4), pp. 631–63. Wilkinson, R. The Impact of Inequality: how to make sick societies healthier. London: Routledge, 2005. Wilkinson, R. & Pickett, K. The Spirit Level: why equality is better for everyone (revised edition). London: Penguin, 2010. World Health Organisation. Mental Health, Resilience, and Inequalities. Copenhagen: World Health Organisation, 2009. Young, M. ‘Down with Meritocracy’. The Guardian, 29 June 2001. ——. The Rise of the Meritocracy 1870–2033: an essay on education and equality. London: Penguin, 1958. Zimbardo, P. The Lucifer Effect: how good people turn evil.

 

pages: 224 words: 69,494

Mobility: A New Urban Design and Transport Planning Philosophy for a Sustainable Future by John Whitelegg

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active transport: walking or cycling, Berlin Wall, British Empire, car-free, conceptual framework, congestion charging, corporate social responsibility, decarbonisation, energy transition, eurozone crisis, glass ceiling, megacity, meta analysis, meta-analysis, New Urbanism, peak oil, post-industrial society, price mechanism, smart cities, telepresence, the built environment, The Death and Life of Great American Cities, The Spirit Level, transit-oriented development, urban planning, urban sprawl

WHO (2013a) Global Status Report on Road Safety, World Health Organisation, Geneva. WHO (2013b) Fact sheet 311, Obesity and overweight, World Health Organisation, Geneva. WHO, (2014a) Air quality deteriorating in many of the world’s cities. News Release, 7th May 2014, World Health Organisation, Geneva. WHO (2014b) Obesity and Overweight. Fact sheet Number 311, May 2014, World Health Organisation, Geneva. Wilkinson, R and Pickett, K (2009) The Spirit Level: why equality is better for everyone, Penguin Books, Harmondsworth. Woodcock, J and 17 others (2009) Public health benefits of strategies to reduce greenhouse gas emissions: urban land transport, Lancet 374:1930-43. World Bank (2014) Transport for health. The global burden of disease from motorised road transport, Report 86304. Yorkshire and Humber Regional Assembly (2008) Achieving low carbon and sustainable transport systems in Yorkshire and Humber, JMP consultants (Leeds) and Stockholm Environment Institute (York).

 

pages: 471 words: 109,267

The Verdict: Did Labour Change Britain? by Polly Toynbee, David Walker

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banking crisis, Big bang: deregulation of the City of London, call centre, central bank independence, congestion charging, Corn Laws, Credit Default Swap, decarbonisation, deglobalization, deindustrialization, Etonian, failed state, first-past-the-post, Frank Gehry, gender pay gap, Gini coefficient, high net worth, hiring and firing, illegal immigration, income inequality, knowledge economy, labour market flexibility, market bubble, millennium bug, North Sea oil, Northern Rock, offshore financial centre, pension reform, Plutocrats, plutocrats, Ponzi scheme, profit maximization, purchasing power parity, shareholder value, Skype, smart meter, stem cell, The Spirit Level, too big to fail, University of East Anglia, working-age population, Y2K

In May 2010 a third of registered voters did not bother themselves with crossing their ballot papers. Add in the unregistered millions, and a large fraction of British people are forever ‘don’t know’ – and probably also ‘don’t much care’. Yet political passivity and even poll reports of general contentment do not mean everything is well; they certainly do not mean people are fulfilled. Published towards the end of Labour’s reign, The Spirit Level by Richard Wilkinson and Kate Pickett amassed international evidence to show the close association between people’s sense of well-being and the objective facts of income distribution; here might even have been a governing proposition. In spite of the evidence, Labour were not sure what they believed or, more debilitating still, whether what they believed was politically doable if it meant challenging power, ownership and the deep complacency of middle England.

 

pages: 353 words: 98,267

The Price of Everything: And the Hidden Logic of Value by Eduardo Porter

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Asian financial crisis, Ayatollah Khomeini, banking crisis, barriers to entry, Berlin Wall, British Empire, capital controls, Carmen Reinhart, Cass Sunstein, clean water, Credit Default Swap, Deng Xiaoping, Edward Glaeser, European colonialism, Fall of the Berlin Wall, financial deregulation, Ford paid five dollars a day, full employment, George Akerlof, Gordon Gekko, guest worker program, happiness index / gross national happiness, housing crisis, illegal immigration, immigration reform, income inequality, income per capita, informal economy, invisible hand, Jean Tirole, John Maynard Keynes: technological unemployment, Kenneth Rogoff, labor-force participation, laissez-faire capitalism, loss aversion, low skilled workers, Martin Wolf, means of production, Menlo Park, Mexican peso crisis / tequila crisis, new economy, New Urbanism, pension reform, Peter Singer: altruism, pets.com, placebo effect, price discrimination, price stability, rent-seeking, Richard Thaler, rising living standards, risk tolerance, Robert Shiller, Robert Shiller, Ronald Reagan, Silicon Valley, stem cell, Steve Jobs, Stewart Brand, superstar cities, The Spirit Level, The Wealth of Nations by Adam Smith, Thomas Malthus, Thorstein Veblen, trade route, transatlantic slave trade, transatlantic slave trade, ultimatum game, unpaid internship, urban planning, women in the workforce, World Values Survey, Yom Kippur War, young professional

&br=1&c=111&s=NGDPRPC%2CNGDPPC&grp=0&a=, accessed 08/09/2010). International comparisons of inequality are found in Organisation for Economic Co-operation and Development, Growing Unequal? Income Distribution and Poverty in OECD Countries (OECD Publishing, October 2008), pp. 77-92. Data on the impact of income inequality on health and segregation are drawn from Richard Wilkinson and Kate Pickett, The Spirit Level: Why More Equal Societies Almost Always Do Better (New York: Bloomsbury Press, 2010); and Joseph Gyourko, Christopher Mayer, and Todd Sinai, “Superstar Cities,” NBER Working Paper, July 2006. 125-127 The Vanishing Middle: The discussion of the impact of education on income growth draws from Claudia Goldin and Lawrence Katz, The Race Between Education and Technology (Cambridge, Mass.: Belknap Press of Harvard University Press, 2008); David Autor and David Dorn, “Inequality and Specialization: The Growth of Low-Skill Service Jobs in the United States,” NBER working paper, November 2008; Congressional Budget Office, “Changes in the Distribution of Workers’ Annual Earnings Between 1979 and 2007,” October 2009; Francine Blau, Marianne Ferber, and Anne Winkler, The Economics of Women, Men and Work, 5th edition (Upper Saddle River, N.J.: Pearson Prentice Hall, 2006); Bureau of Labor Statistics (www.bls.gov/news.release/wkyeng.t05.htm, accessed 08/08/2010); Census Bureau, “Income, Poverty, and Health Insurance Coverage in the United States,” 2008 (www.census.gov/prod/2009pubs/p60-236.pdf, accessed 08/09/2010); Bureau of Labor Statistics, “100 Years of U.S.

 

pages: 209 words: 89,619

The Precariat: The New Dangerous Class by Guy Standing

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8-hour work day, banking crisis, barriers to entry, Bertrand Russell: In Praise of Idleness, call centre, Cass Sunstein, centre right, collective bargaining, corporate governance, crony capitalism, deindustrialization, deskilling, fear of failure, full employment, hiring and firing, Honoré de Balzac, housing crisis, illegal immigration, immigration reform, income inequality, labour market flexibility, labour mobility, land reform, libertarian paternalism, low skilled workers, lump of labour, marginal employment, Mark Zuckerberg, means of production, mini-job, moral hazard, Naomi Klein, nudge unit, pensions crisis, placebo effect, post-industrial society, precariat, presumed consent, quantitative easing, remote working, rent-seeking, Richard Thaler, rising living standards, Ronald Coase, Ronald Reagan, science of happiness, shareholder value, Silicon Valley, The Market for Lemons, The Nature of the Firm, The Spirit Level, Tobin tax, transaction costs, universal basic income, unpaid internship, winner-take-all economy, working poor, working-age population, young professional

G. and Kivimäki, M. (2010), ‘Overtime Work and Incident Coronary Heart Disease: The Whitehall II Prospective Cohort Study’, European Heart Journal, 31: 1737–44. Wacquant, L. (2008), ‘Ordering Insecurity: Social Polarization and the Punitive Upsurge’, Radical Philosophy Review, 11(1): 9–27. Weber, M. ([1922] 1968), Economy and Society, Berkeley, CA, and Los Angeles, CA: University of California Press. Wilkinson, R. and Pickett, K. E. (2009), The Spirit Level: Why More Equal Societies Almost Always Do Better, London: Allen Lane. Willetts, D. (2010), The Pinch: How the Baby Boomers Took Their Children’s Future – and Why They Should Give It Back, London: Atlantic. Willsher, K. (2010), ‘Leaked Memo Shows France’s Expulsion of Roma Illegal, Say Critics’, Guardian, 14 September, p. 20. Wong, E. (2009), ‘China Confronts Backlash from Its Mass Exports of Labor’, International Herald Tribune, 21 December, p. 16.

 

pages: 370 words: 102,823

Rethinking Capitalism: Economics and Policy for Sustainable and Inclusive Growth by Michael Jacobs, Mariana Mazzucato

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3D printing, balance sheet recession, banking crisis, Bernie Sanders, Bretton Woods, business climate, Carmen Reinhart, central bank independence, collaborative economy, complexity theory, conceptual framework, corporate governance, corporate social responsibility, credit crunch, Credit Default Swap, crony capitalism, David Ricardo: comparative advantage, decarbonisation, deindustrialization, dematerialisation, Detroit bankruptcy, double entry bookkeeping, Elon Musk, energy security, eurozone crisis, factory automation, facts on the ground, fiat currency, Financial Instability Hypothesis, financial intermediation, forward guidance, full employment, Gini coefficient, Growth in a Time of Debt, Hyman Minsky, income inequality, Internet of things, investor state dispute settlement, invisible hand, Isaac Newton, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, labour market flexibility, low skilled workers, Martin Wolf, Mont Pelerin Society, neoliberal agenda, Network effects, new economy, non-tariff barriers, paradox of thrift, price stability, private sector deleveraging, quantitative easing, QWERTY keyboard, railway mania, rent-seeking, road to serfdom, savings glut, Second Machine Age, secular stagnation, shareholder value, sharing economy, Silicon Valley, Steve Jobs, the built environment, The Great Moderation, The Spirit Level, Thorstein Veblen, too big to fail, total factor productivity, transaction costs, trickle-down economics, universal basic income, very high income

Cingano, Trends in Income Inequality and Its Impact on Economic Growth, OECD Social, Employment and Migration Working Papers, No. 163, December 2014, http://www.oecd.org/els/soc/trends-in-income-inequality-and-its-impact-on-economic-growth-SEM-WP163.pdf (accessed 12 April 2016). 57 J. D. Ostry, A. Berg and C. G. Tsangarides, Redistribution, Inequality and Growth, IMF Staff Discussion Note, SDN 14/02, 2014, https://www.imf.org/external/pubs/ft/sdn/2014/sdn1402.pdf (accessed 12 April 2016). For a wider discussion on the relationship between economic performance, well-being and inequality, see R. G. Wilkinson and K. Pickett, The Spirit Level: Why More Equal Societies Almost Always Do Better, London, Allen Lane, 2009. 58 R. Riley and C. Rosazza Bondibene, Raising the Standard: Minimum Wages and Firm Productivity, NIESR Discussion Paper 449, National Institute for Economic and Social Research, 2015, http://www.niesr.ac.uk/sites/default/files/publications/Minimum%20wages%20and%20firm%20productivity%20NIESR%20DP%20449.pdf (accessed 12 April 2016). 59 N.

 

pages: 323 words: 90,868

The Wealth of Humans: Work, Power, and Status in the Twenty-First Century by Ryan Avent

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3D printing, Airbnb, American energy revolution, autonomous vehicles, Bakken shale, barriers to entry, Bernie Sanders, BRICs, call centre, Capital in the Twenty-First Century by Thomas Piketty, Clayton Christensen, cloud computing, collective bargaining, computer age, dark matter, David Ricardo: comparative advantage, deindustrialization, dematerialisation, Deng Xiaoping, deskilling, Dissolution of the Soviet Union, Donald Trump, Downton Abbey, Edward Glaeser, Erik Brynjolfsson, eurozone crisis, everywhere but in the productivity statistics, falling living standards, first square of the chessboard, first square of the chessboard / second half of the chessboard, Ford paid five dollars a day, Francis Fukuyama: the end of history, future of work, gig economy, global supply chain, global value chain, hydraulic fracturing, income inequality, indoor plumbing, industrial robot, interchangeable parts, Internet of things, inventory management, invisible hand, Jacquard loom, James Watt: steam engine, Jeff Bezos, John Maynard Keynes: Economic Possibilities for our Grandchildren, Joseph-Marie Jacquard, knowledge economy, low skilled workers, lump of labour, Lyft, manufacturing employment, means of production, new economy, performance metric, pets.com, price mechanism, quantitative easing, Ray Kurzweil, rent-seeking, reshoring, rising living standards, Robert Gordon, Ronald Coase, savings glut, Second Machine Age, secular stagnation, self-driving car, sharing economy, Silicon Valley, single-payer health, software is eating the world, supply-chain management, supply-chain management software, TaskRabbit, The Nature of the Firm, The Spirit Level, The Wealth of Nations by Adam Smith, Thomas Malthus, trade liberalization, transaction costs, Tyler Cowen: Great Stagnation, Uber and Lyft, Uber for X, very high income, working-age population

Johnson, 1798) Marx, Karl, and Engels, Friedrich, Manifesto of the Communist Party (1848) Milanovic, Branko, Global Inequality: A New Approach for the Age of Globalization (Cambridge, MA: Harvard University Press, 2016) Mokyr, Joel, The Gifts of Athena: Historical Origins of the Knowledge Economy (Princeton, NJ: Princeton University Press, 2002) _____, The Lever of Riches: Technological Creativity and Economic Progress (Oxford: Oxford University Press, 1990) Moretti, Enrico, The New Geography of Jobs (New York, NY: Houghton Mifflin Harcourt, 2012) Murray, Charles, Coming Apart: The State of White America, 1960–2010 (New York, NY: Crown Publishing Group, 2012) Pickett, Kate, and Wilkinson, Richard, The Spirit Level: Why Greater Equality Makes Societies Stronger (London: Allen Lane, 2009) Piketty, Thomas, Capital in the Twenty-First Century (Cambridge, MA: Harvard University Press, 2014) Putnam, Robert, Bowling Alone: The Collapse and Revival of American Community (New York, NY: Simon & Schuster, 2001) Rifkin, Jeremy, The Zero Marginal Cost Society: The Internet of Things, the Collaborative Commons, and the Eclipse of Capitalism (London: Palgrave Macmillan, 2014) Rodrik, Dani, The Globalization Paradox: Democracy and the Future of the World Economy (Oxford: Oxford University Press, 2011) Saadia, Manu, Trekonomics: The Economics of Star Trek (San Francisco, CA: Pipertext, 2016) Shirky, Clay, Cognitive Surplus: Creativity and Generosity in a Connected Age (London: Allen Lane, 2010) Smith, Adam, An Inquiry into the Nature and Causes of the Wealth of Nations (London: W.

 

pages: 481 words: 120,693

Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else by Chrystia Freeland

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Albert Einstein, algorithmic trading, banking crisis, barriers to entry, Basel III, battle of ideas, Bernie Madoff, Big bang: deregulation of the City of London, Black Swan, Branko Milanovic, Bretton Woods, BRICs, business climate, call centre, carried interest, Cass Sunstein, Clayton Christensen, collapse of Lehman Brothers, conceptual framework, corporate governance, credit crunch, Credit Default Swap, crony capitalism, Deng Xiaoping, don't be evil, double helix, energy security, estate planning, experimental subject, financial deregulation, financial innovation, Flash crash, Frank Gehry, Gini coefficient, global village, Goldman Sachs: Vampire Squid, Gordon Gekko, Guggenheim Bilbao, haute couture, high net worth, income inequality, invention of the steam engine, job automation, joint-stock company, Joseph Schumpeter, knowledge economy, knowledge worker, linear programming, London Whale, low skilled workers, manufacturing employment, Mark Zuckerberg, Martin Wolf, Mikhail Gorbachev, Moneyball by Michael Lewis explains big data, NetJets, new economy, Occupy movement, open economy, Peter Thiel, place-making, Plutocrats, plutocrats, Plutonomy: Buying Luxury, Explaining Global Imbalances, postindustrial economy, Potemkin village, profit motive, purchasing power parity, race to the bottom, rent-seeking, Rod Stewart played at Stephen Schwarzman birthday party, Ronald Reagan, self-driving car, short selling, Silicon Valley, Silicon Valley startup, Simon Kuznets, Solar eclipse in 1919, sovereign wealth fund, stem cell, Steve Jobs, The Spirit Level, The Wealth of Nations by Adam Smith, Tony Hsieh, too big to fail, trade route, trickle-down economics, Tyler Cowen: Great Stagnation, wage slave, Washington Consensus, winner-take-all economy

Pettis, Michael. The Volatility Machine: Emerging Economics and the Threat of Financial Collapse. Oxford University Press, 2001. Philippon, Thomas, and Ariell Reshef. “Wages and Human Capital in the U.S. Finance Industry: 1909–2006.” Working paper. March 2011. Phillips, Kevin. Wealth and Democracy: A Political History of the American Rich. Broadway, 2002. Pickett, Kate, and Richard Wilkinson. The Spirit Level: Why Greater Equality Makes Societies Stronger. Bloomsbury, 2009. Piketty, Thomas, and Emmanuel Saez. “The Evolution of Top Incomes: A Historical and International Perspective.” American Economic Review: Papers and Proceedings 96:2 (May 2006). pp. 200–205. ———. “Income Inequality in the United States, 1913–1998.” Quarterly Journal of Economics 118:1 (2003). pp. 1–39. Porter, Eduardo.

 

pages: 503 words: 131,064

Liars and Outliers: How Security Holds Society Together by Bruce Schneier

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airport security, barriers to entry, Berlin Wall, Bernie Madoff, Bernie Sanders, Brian Krebs, Broken windows theory, carried interest, Cass Sunstein, Chelsea Manning, corporate governance, crack epidemic, credit crunch, crowdsourcing, cuban missile crisis, Daniel Kahneman / Amos Tversky, David Graeber, desegregation, don't be evil, Double Irish / Dutch Sandwich, Douglas Hofstadter, experimental economics, Fall of the Berlin Wall, financial deregulation, George Akerlof, hydraulic fracturing, impulse control, income inequality, invention of agriculture, invention of gunpowder, iterative process, Jean Tirole, John Nash: game theory, joint-stock company, Julian Assange, meta analysis, meta-analysis, microcredit, moral hazard, mutually assured destruction, Nate Silver, Network effects, Nick Leeson, offshore financial centre, patent troll, phenotype, pre–internet, principal–agent problem, prisoner's dilemma, profit maximization, profit motive, race to the bottom, Ralph Waldo Emerson, RAND corporation, rent-seeking, RFID, Richard Thaler, risk tolerance, Ronald Coase, security theater, shareholder value, slashdot, statistical model, Steven Pinker, Stuxnet, technological singularity, The Market for Lemons, The Nature of the Firm, The Spirit Level, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, theory of mind, too big to fail, traffic fines, transaction costs, ultimatum game, UNCLOS, union organizing, Vernor Vinge, WikiLeaks, World Values Survey, Y2K

Regulation, 27:42–6. exaggerate the risk John Mueller (2006), Overblown: How Politicians and the Terrorism Industry Inflate National Security Threats, and Why We Believe Them, Free Press. tolerance for risk Meir Statman (2010), “The Cultures of Risk Tolerance,” Social Sciences Research Network Behavioral & Experimental Finance eJournal, 1–23. income inequality Kate Pickett and Richard Wilkinson (2011), The Spirit Level: Why Greater Equality Makes Societies Stronger, Bloomsbury Press. false confessions Saul M. Kassin, “False Confessions: Causes, Consequences, and Implications for Reform,” Current Directions in Psychological Science, 17: 249–53. Jennifer T. Perillo and Saul M. Kassin (2011), “Inside Interrogation: The Lie, The Bluff, and False Confessions,” Law & Human Behavior, 35:327–37. teachers cheated on Jack Gillum and Marisol Bello (30 Mar 2011), “When Standardized Test Scores Soared in D.C., Were the Gains Real?”

 

pages: 374 words: 114,660

The Great Escape: Health, Wealth, and the Origins of Inequality by Angus Deaton

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Admiral Zheng, agricultural Revolution, Branko Milanovic, BRICs, British Empire, call centre, clean water, colonial exploitation, Columbian Exchange, declining real wages, Downton Abbey, financial innovation, germ theory of disease, Gini coefficient, illegal immigration, income inequality, invention of agriculture, invisible hand, John Snow's cholera map, knowledge economy, Louis Pasteur, low skilled workers, new economy, purchasing power parity, randomized controlled trial, rent-seeking, rising living standards, Ronald Reagan, Simon Kuznets, Steve Jobs, Steven Pinker, structural adjustment programs, The Spirit Level, too big to fail, trade route, very high income, War on Poverty

Daniel Kahneman and Jason Riis, 2005, “Living, and thinking about it: Two perspectives on life,” in Felicia Huppert, Nick Baylis, and Barry Keverne, eds., The science of well-being, Oxford University Press, 285–304. 17. Ronald Inglehart and Hans-Dieter Klingemann, 2000, “Genes, culture, democracy and happiness,” in Ed Diener and Eunkook M. Suh, eds., Culture and subjective well-being, MIT Press, 165–83; Richard Layard, 2005, Happiness: Lessons from a new science, Penguin; and Richard Wilkinson and Kate Pickett, 2009, The spirit level: Why greater equality makes societies stronger, Bloomsbury. CHAPTER ONE: THE WELLBEING OF THE WORLD 1. For a related calculation, see James Vaupel and John M. Owen, 1986, “Anna’s life expectancy,” Journal of Policy Analysis and Management 5(2): 383–89. 2. Robert C. Allen, Tommy E. Murphy, and Eric B. Schneider, 2012, “The colonial origins of the divergence in the Americas: A labor market approach,” Journal of Economic History 72(4): 863–94. 3.

 

pages: 580 words: 168,476

The Price of Inequality: How Today's Divided Society Endangers Our Future by Joseph E. Stiglitz

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affirmative action, Affordable Care Act / Obamacare, airline deregulation, Andrei Shleifer, banking crisis, barriers to entry, Basel III, battle of ideas, Berlin Wall, capital controls, Carmen Reinhart, Cass Sunstein, central bank independence, collapse of Lehman Brothers, collective bargaining, colonial rule, corporate governance, Credit Default Swap, Daniel Kahneman / Amos Tversky, Dava Sobel, declining real wages, deskilling, Exxon Valdez, Fall of the Berlin Wall, financial deregulation, financial innovation, Flash crash, framing effect, full employment, George Akerlof, Gini coefficient, income inequality, income per capita, indoor plumbing, inflation targeting, invisible hand, John Harrison: Longitude, John Maynard Keynes: Economic Possibilities for our Grandchildren, Kenneth Rogoff, labour market flexibility, London Interbank Offered Rate, lone genius, low skilled workers, Mark Zuckerberg, market bubble, market fundamentalism, medical bankruptcy, microcredit, moral hazard, mortgage tax deduction, obamacare, offshore financial centre, paper trading, patent troll, payday loans, price stability, profit maximization, profit motive, purchasing power parity, race to the bottom, rent-seeking, reserve currency, Richard Thaler, Robert Shiller, Robert Shiller, Ronald Coase, Ronald Reagan, shareholder value, short selling, Silicon Valley, Simon Kuznets, spectrum auction, Steve Jobs, technology bubble, The Chicago School, The Fortune at the Bottom of the Pyramid, The Myth of the Rational Market, The Spirit Level, The Wealth of Nations by Adam Smith, too big to fail, trade liberalization, transaction costs, trickle-down economics, ultimatum game, uranium enrichment, very high income, We are the 99%, women in the workforce

Of course, selling the TV (or one of these other appliances) would not go far to provide food, medical care, housing, or access to good schools. There is another important area, exploring the relationship between consumption and happiness, going back at least to Veblen’s (1899) Theory of the Leisure Class, which introduced the concept of “conspicuous consumption.” More recently, Richard Wilkinson and Kate Pickett, in The Spirit Level: Why Greater Equality Makes Societies Stronger (New York: Bloomsbury Press, 2009), argue that more equality can improve happiness through reducing “social evaluation anxieties” and associated stresses. 105. See U.S. Census, “The Research Supplemental Poverty Measure: 2010,” November 2011. 106. As we’ll explain in chapter 3, there are two sides of this argument (both wrong). The first is that taxing the top at higher rates will reduce their incentives to work and save, so much that tax revenues may even fall; the second is that helping the poor will just breed more poverty—inducing those at the bottom not to work. 107.

 

pages: 598 words: 172,137

Who Stole the American Dream? by Hedrick Smith

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Affordable Care Act / Obamacare, airline deregulation, anti-communist, asset allocation, banking crisis, Bonfire of the Vanities, British Empire, business process, clean water, cloud computing, collateralized debt obligation, collective bargaining, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, David Brooks, Deng Xiaoping, desegregation, Double Irish / Dutch Sandwich, family office, full employment, global supply chain, Gordon Gekko, guest worker program, hiring and firing, housing crisis, Howard Zinn, income inequality, index fund, informal economy, invisible hand, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, knowledge worker, laissez-faire capitalism, late fees, Long Term Capital Management, low cost carrier, manufacturing employment, market fundamentalism, Maui Hawaii, mortgage debt, new economy, Occupy movement, Own Your Own Home, Peter Thiel, Plutonomy: Buying Luxury, Explaining Global Imbalances, Ponzi scheme, Ralph Nader, RAND corporation, Renaissance Technologies, reshoring, rising living standards, Robert Shiller, Robert Shiller, rolodex, Ronald Reagan, shareholder value, Shenzhen was a fishing village, Silicon Valley, Silicon Valley startup, Steve Jobs, The Chicago School, The Spirit Level, too big to fail, transaction costs, transcontinental railway, union organizing, Unsafe at Any Speed, Vanguard fund, We are the 99%, women in the workforce, working poor, Y2K

New York: Basic Books, 1996. Vogel, David. Fluctuating Fortunes: The Political Power of Business in America. New York: Basic Books, 1989. Warren, Elizabeth, and Amelia Warren Tyagi. The Two-Income Trap: Why Middle-Class Parents Are Going Broke. New York: Basic Books 2003. Wicker, Tom. One of Us: Richard Nixon and the American Dream. New York: Random House, 1991. Wilkinson, Richard, and Kate Pickett. The Spirit Level: Why Greater Equality Makes Societies Stronger. New York: Bloomsbury Press, 2009. Woodward, Bob. Obama’s Wars. New York: Simon & Schuster, 2010. Young, Andrew. An Easy Burden: The Civil Rights Movement and the Transformation of America. New York: HarperCollins, 1996. ———, and Kabir Sehdal. Walk in My Shoes: Conversations Between a Civil Rights Legend and His Godson on the Journey Ahead.