How is ‘happiness’ measured? Life satisfaction is typically measured with the following question:All things considered, how satisfied are you with your life as a whole these days?
The straight line indicates perfect equality in the distribution of income: e.g. 10% of the population receives 10% of the income, 20% of the population receives 20% of the income, etc. The area between the straight line representing perfect equality and the curved line (called a Lorenz curve) representing actual income distribution is known as the Gini coefficient. The farther the line is from the straight line (45 degree angle), the larger the income inequality, and thus, the larger the Gini coefficient.
There are three data points, representing low income, middle income, and high income countries, in the years 1970 and 1990. We see that the distance between the three groups has remained relatively stable. We also see that, inequality within low income and middle income nations has declined slightly, whereas in high income nations, economic growth has exacerbated economic inequalities. It is difficult to assess the Kuznets curve hypothesis with this data. The first two data points (low and middle income countries) might be seen as confirming the Kuznets curve, so long as we assume that prior industrialization has increased inequality there, over and above what it used to be, which is questionable. The trend for the high income nations, however, is not consistent with the Kuznets Curve. The overall pattern for each year does resemble a Kuznets Curve, because inequality is higher for middle income nations
Inequality Charts (US and Global)
OutlineI. Inequality within the USII. Global InequalityIII. The importance of Equality
Income Inequality within the US Percentage of Total Income Earned by the Top 10 Percent United States (1970-2009) 50.0 47.1 44.3 Percentage 41.4 38.6 35.7 32.9 30.0 1970 1980 1990 2000 2010 Year
CEO and Worker Pay CEOs pay as a multiple of the average workers pay, 1960-2007Source: Domhoff 2011
Wealth Concentration in the United States Distribution of net worth and financial wealth Top 1 percent Next 19 percent Bottom 80 percent1983 33.8% 47.5% 18.7%1989 37.4% 46.2% 16.5%1992 37.2% 46.6% 16.2%1995 38.5% 45.4% 16.1%1998 38.1% 45.3% 16.6%2001 33.4% 51.0% 15.6%2004 34.3% 50.3% 15.3%2007 34.6% 50.5% 15.0% Source: Domhoff 2011
Financial Wealth in the United States Top 1 percent Next 19 percent Bottom 80 percent1983 42.9% 48.4% 8.7%1989 46.9% 46.5% 6.6%1992 45.6% 46.7% 7.7%1995 47.2% 45.9% 7.0%1998 47.3% 43.6% 9.1%2001 39.7% 51.5% 8.7%2004 42.2% 50.3% 7.5%2007 42.7% 50.3% 7.0% Source: Domhoff 2011
Wealth and Financial Wealth Distribution 2007Source: Domhoff 2011
Every group except the top 1% had a smaller share of income in 2007 than they did in1979, or just an equal share in the case of the 81st-99th percentile group. That meansthe gains in the top quintile are all concentrated in the top 1%.
Kuznets Curve Refuted Rising Inequality within high income nations, and falling inequality within low income nations
Inequality trends in rich nations Gini coefficient Country percentage change (1990-2006) Inequality in the US and Austria -10.7 UK has increased Belgium 20.7 dramatically since the Denmark -3.4 Finland 20.0 1970s, France -5.9 And rising inequality is Germany 5.1 not offset by greater Greece 2.1 Ireland -2.4 upward mobility and Italy 5.6 change between Luxembourg 12.1 economic categories. Netherlands -2.3 But, this does not Norway 10.8 Portugal 5.5 reflect a more general Spain 2.3 trend... Sweden 3.5 Switzerland -10.7 UK 2.7 European Union 0.0