How economic inequality harms societies Richard Wilkinson
you all know the truth of what I’m gonna
say
I think the intuition that inequality is
divisive and socially corrosive has been
around since before the French
Revolution what’s changed is we now can
look at the evidence we can compare
societies more and less equal societies
and see what inequality does I’m going
to take you through that data and then
explain why the links that I think I’m
going to be showing you exist but first
see what a miserable lot we are I want
to start though with a paradox this
shows you life expectancy against gross
national income how rich countries are
on average and you see the countries on
the right like Norway in the USA a twice
as rich as Israel Greece Portugal on the
left and it makes no difference to their
life expectancy at all there’s no
suggestion of a relationship there but
if we look within our societies there
are extraordinary social gradients in
health running right across society is
again is life expectancy these are small
areas of England and Wales the poorest
on the right the richest on the left not
a difference between the poor and the
rest of us even the people just below
the top have less good health than the
people at the top so income means
something very important within our
societies and nothing between them the
explanation of that paradox is that
within our societies were looking at
relative income or social position
social status where we are in relation
to each other and the size of the gaps
between us and as soon as you’ve got
that idea you should immediately wonder
what happens if we widen the differences
or compress them make the income
differences bigger or smaller and that’s
what I’m going to show you I’m not using
any hypothetical data I’m taking data
from the UN it’s the same as the world
has on the scale of income differences
in these rich developed market
democracies the measure we’ve used sis
because it’s easy to understand and you
can download it is how much richer the
top 20% than the bottom 20% in each
country and you see in the moral
countries on the Left Japan Finland
Norway Sweden the top 20% about three
and a half four times as rich as the
bottom 20% but at the more unequal end
UK Portugal USA Singapore the
differences are twice as big on that
measure we are twice as unequal as some
of the other successful market
democracies now I’m going to show you
what that does to our societies we
collected data on problems with social
gradients the kind of problems are more
common at the bottom of the social
ladder internationally comparable data
on life expectancy on kids maths and
literacy scores on infant mortality
rates homicide rates proportion of the
population in prison teenage birth rates
levels of trust obesity mental illness
rich in the standard diagnostic
classification includes drug and alcohol
addiction and social mobility we put
them the year all in one index are all
weighted equally where country is is
sort of average score on these things
and there you see it in relation to the
measure of inequality I just shown you
which I shall use over and over again in
data the more unequal countries doing
worse on all these kinds of social
problems
it’s an extraordinary close correlation
but if you look at that same index of
health and social problems in relation
to GNP per capita gross national income
there’s nothing there no correlation
anymore we were a little bit worried
that people might think we’d been
choosing problems to suit our argument
and just manufactured this this evidence
so we also looked in we did a paper in
the British Medical Journal on the
UNICEF index of child well-being it has
40 different components put together by
other people
it contains weather
can talk to their parents whether they
have books at home what immunization
rates are like weathers bullying at
school everything goes into it here it
is in relation to that same measure of
inequality kids doing worse in the
morning society’s highly significant
relationship but once again if you look
at that measure of child well-being in
relation to national income per person
there’s no relationship no suggestion of
relationship what all the data I’ve
shown you so far says is the same thing
the average well-being of our societies
is not dependent any longer on national
income and economic growth that’s very
important in poorer countries but not in
the rich developed world but the
difference is between us and where we
are in relation to each other now matter
very much I’m going to show you some of
the separate bits of our index here for
instance is trust it’s simply the
proportion of the population who agree
most people can be trusted comes from
the World Values Survey you see it the
more unequal end it’s about 15% of the
population who feel they can trust
others but in the more equal societies
it rises to 60 or 65% and if you look at
measures of involvement in community
life or social capital very similar
relationships closely related to
inequality I may say we did all this
work twice we did it first on these rich
developed countries and then as a
separate testbed we repeated it all on
the 50 American states asking just the
same question to the more unequal States
to worse on all these kinds of measures
so here is trust from the General Social
Survey of the federal government related
to inequality very similar scatter of a
similar range of levels of trust same
thing is going on basically we found
that almost anything that’s related to
trust internationally is related to
trust amongst the 50 states in that
separate test bed we’re not just talking
about a fluke this is mental illness
w-h-o put together figures using this
same diagnostic interviews on random
samples of the population to allow us to
compare rates of mental illness in each
Society this is the percent of the
population with any mental illness in
the preceding year and it does from
about 8 percent up to 3 times that whole
societies with three times the level of
mental illness of others and again
closely related to inequality this is
violence these red dots are American
states and the blue triangles of
Canadian provinces but look at the scale
of the differences it goes from 15
homicides per million up to 150 this is
the proportion of the population in
prison there’s about a tenfold
difference their log scale up the side
but it goes from about 40 to 400 people
in prison that relationship is not
mainly driven by more crime in some
places that’s part of it but most of it
is about more punitive sentencing
harsher sentencing and the more unequal
societies are more likely also to retain
the death penalty here we have children
dropping out of high school again quite
big differences extraordinarily damaging
if you’re talking about using the
talents of the population this is social
mobility it’s actually a measure of
mobility based on income basically it’s
asking do rich fathers have rich sons
and poor fathers have poor sons or is
there no relationship between the two
and at the more unequal end fathers
income is much more important in the UK
USA and in countries the Scandinavian
countries fathers income is much less
important there’s more social mobility
and as we like to say and I know a lot
of Americans in the audience here if
Americans want to live the American
Dream they should go to Denmark
I’ve shown you just a few things in
italics here I could have shown you a
number of other problems that all
problems that tend to be more common at
the bottom of the social gradient but
there are endless problems with social
gradients that are worse in more unequal
countries not just a little bit worse
but anything from twice as common to ten
times as common think of the expense the
human cost of that I want to go back
there to this graph that I showed you
earlier where we put it all together to
make two points one is that in graph
after graph we find the countries that
do worse whatever the outcome seemed to
be the more unequal ones and the ones
that do well seem to be the Nordic
countries in Japan so what we’re looking
at is general social dysfunction related
to inequality it’s not just one or two
things that go wrong it’s most things
the other really important point I I
want to make on this graph is that if
you look at the bottom Sweden and Japan
there are very different countries in
all sorts of ways the position of women
how closely they keep - no clear family
the opposite ends of the poles in terms
of the rich developed world but another
really important difference is how they
get their great a equality Sweden has
huge differences in earnings and it
narrows the gap through taxation general
welfare states generous benefits and so
on
Japan is rather different though it
starts off with much smaller differences
in earnings before tax it has lower
taxes it has a smaller welfare state and
in our analysis of American States
recite find rather the same contrast the
some states that do well through
redistribution some states that do well
because they have smaller income
differences before tax so we conclude
that it doesn’t much matter how you get
your greater equality as long as you get
there somehow I’m not talking about
perfect equality I am talking about what
exists in rich developed market
democracies
another really surprising part of this
picture is that it’s not just the poor
who affected by inequality there seems
to be some truth in John Dunn’s no man
is an island in the number of studies
it’s possible to compare how people do
in more and less equal countries at each
level in the social hierarchy this is
just one example its infant mortality
some Swedes very kindly classified a lot
of their infant deaths according to the
British Registrar General socio-economic
classification and so it’s
anachronistically a classification by
father’s occupation so single parents go
on their own but then the low wet says
low social class that’s unskilled manual
occupations it goes through towards the
skilled manual occupations and a little
gentler than the junior non manual going
up the high to the professional
occupations doctors lawyers directors of
larger companies you see there that
Sweden does better than Britain all the
way across the social hierarchy the
biggest difference is at the bottom of
society but even at the top there seems
to be a small benefit to being in a more
equal society we show that on about five
different sets of data covering
educational outcomes and health in the
United States and internationally and
that seems to be the general picture
that greater equality makes most
difference at the bottom but has some
benefit even at the top but I should say
a few words about what’s going on I
think I’m looking and talking about the
psychosocial effects of inequality more
to do with feelings of superiority and
inferiority of being valued and devalued
respected and disrespected and of course
those feelings of the status competition
that comes out of that drives the
consumerism in our society it also leads
to status insecurity we worry more about
how we’re judged and seen by others
whether we’re regarded as attractive
clever
all that kind of thing the social
evaluative judgments increase the fear
of there’s social evaluative judgments
interestingly some work parallel work
going on in social psychology some
people reviewed 208 different studies in
which volunteers had been invited into
psychological laboratory and had their
stress hormones their responses to doing
stressful tasks measured and in the
review what they were interested in
seeing is what kind of stresses most
reliably raise levels of cortisol the
central stress hormone and the
conclusion was it was tasks that
included social evaluative threat
threats to self esteem or social status
in which others can negatively judge
your performance those kind of stresses
have a very particular effect on the
physiology of stress now we have been
criticized of course there are people
who dislike this stuff and people who
find it very surprising I should tell
you though that when people criticize us
for picking and choosing data we never
pick and choose data we have an absolute
rule that if our data source has data
for one of the countries we’re looking
at it goes into the analysis our data
source decides whether it’s a reliable
data we don’t otherwise that would
introduce bias what about other
countries there are 200 studies of
health in relation to income inequality
in the academic peer-reviewed journals
this isn’t confined to these countries
here hiding a very simple demonstration
that the same countries the same measure
of inequality one problem after another
why don’t we control for other factors
well we’ve shown you that GNP per capita
doesn’t make any difference
and of course others using more
sophisticated methods in the literature
have controlled for poverty and
education and so on
what about causality correlation in
itself doesn’t prove prove causality we
spend a good bit of time and indeed
people know the causal links quite well
in some of these outcomes a big change
in our understanding of drivers of
chronic of of health in the rich
developed world is how important chronic
stress from social sources is affecting
the immune system the cardiovascular
system or for instance the reason why
violence becomes more common in more
unequal societies is because people are
sensitive to being looked down on I
should say to deal with this we’ve got
to deal with the post-tax things and the
pretax things we’ve got to constrain
income the bonus culture in comes at the
top I think we must make bosses
accountable to their employees in any
way we can I think the take-home message
though is that we can improve the real
quality of human life by reducing the
differences in incomes between us
suddenly we have a handle on the
psychosocial well-being of whole
societies and that’s exciting thank you
you