How economic inequality harms societies - Richard Wilkinson

How Economic Inequality Harms Societies - Richard Wilkinson

Short Summary:

Richard Wilkinson argues that economic inequality is a major social problem, leading to a range of negative consequences for societies. He presents data showing a strong correlation between income inequality and social problems like lower life expectancy, higher rates of mental illness, violence, and lower levels of trust. Wilkinson emphasizes that this is not just a problem for the poor, but affects all levels of society, with even the wealthy experiencing some negative effects. He proposes that reducing income inequality through policies like taxation and welfare programs can improve the overall well-being of societies.

Detailed Summary:

Section 1: The Paradox of Inequality

Wilkinson begins by highlighting a paradox: while wealthier countries have higher life expectancies, there are significant differences in life expectancy within those countries, with the poorest having significantly shorter lifespans compared to the wealthiest.
He explains that this difference is due to relative income and social status, suggesting that the size of the gap between rich and poor is more important than overall wealth.

Section 2: The Data on Inequality and Social Problems

Wilkinson presents data from the UN showing a strong correlation between income inequality and a range of social problems.
He uses an index that combines data on life expectancy, education, infant mortality, homicide rates, imprisonment rates, teenage birth rates, trust, obesity, mental illness, and social mobility.
The data consistently shows that more unequal countries perform worse on all these measures.
He emphasizes that this relationship holds true even when controlling for factors like national income.

Section 3: The Importance of Reducing Inequality

Wilkinson argues that reducing income inequality is crucial for improving the overall well-being of societies.
He highlights that the average well-being of societies is no longer dependent on national income in wealthy countries, but rather on the level of income inequality.
He emphasizes that the negative effects of inequality are not limited to the poor, but extend to all levels of society.

Section 4: The Mechanisms of Inequality

Wilkinson suggests that the negative effects of inequality are driven by psychosocial factors, such as feelings of superiority and inferiority, status competition, and social evaluative judgments.
He cites research showing that social evaluative threats, which threaten self-esteem and social status, lead to increased stress hormone levels.

Section 5: Addressing Inequality

Wilkinson argues that addressing inequality requires both pre-tax and post-tax measures.
He advocates for policies that constrain income inequality at the top, such as limiting bonuses and making bosses accountable to employees.
He concludes that reducing income inequality is a key to improving the quality of life for all members of society.

Notable Quotes:

"We can improve the real quality of human life by reducing the differences in incomes between us."
"If Americans want to live the American Dream, they should go to Denmark."
"It doesn't much matter how you get your greater equality, as long as you get there somehow."
"We have a handle on the psychosocial well-being of whole societies, and that's exciting."