DISQUS

Will Wilkinson: What, Me Worry… about Inequality?

  • Kyle · 3 years ago
    Will - are you familiar with the concept of intentional community? The now-politically-incorrect term for them is hippie commune.

    There is one just south of you in Louisa, VA called Twin Oaks. This collective formed for a lot of different reasons. But one of the professed goals of this commune is to isolate its members from the disparities in income that exist outside.

    Why do people have a value for this?

    They recognize that their sense of well-being is dictated not by some absolute measure of material well-being (they have "enough") but by the mere existence of people with more. No ipods, or mountain bikes, or computers unless everyone has equal access and thus is on the same level of meterial well-being.

    So you may say - well good for them. The market provides. Only it doesn't. The wealth of the people from outside is not so easily isolated. It slips in. So we have market failure along the lines of an externality. Your being rich has material effect on the well-being of others. You can decry this as pathological if you wish, but envy is very real and is most likely an evolved characteristic of the human mind (and the minds of many other species).

    So the Joneses problem is a coordination problem. Perhaps if we could all agree to stop driving forward beyond what is merely "enough" we might all be better off with the observed upper bound for human consumption being held down. But unilaterally, each is more than willing to push harder the more people hold back as it increases the chance he or she can be at the frontier of human happiness.

    A perfect example is the mandating of longer holidays in Europe. You can only relax if you know we are all going to take a break together. Of course - the increasing material well-being of people like in the United States are undermining this process by demonstrating a higher potential for human happiness over here.

    I am not saying that I am married to this idea. But I just want you to see where I coming from.
  • Paul Zrimsek · 3 years ago
    Sorry, Kyle, but if you want us to subjugate the requirements of our natural greed to those of our natural envy, you're going to have to come up with a better justification than "well, it's natural".