Sometimes a graph says more than a thousand words

20 September, 2012 at 16:37 | Posted in Economics | 1 Comment

If you thought that inequality was no problem, I think you should take a look at this graph:
 

The vertical axis shows how much a one percent rise in the income of your father affects your expected income (the higher the number, the lower is the expected social mobility). On the horizontal axis is the Gini coefficient, which is a measure of inequality (the higher the number, the higher is the inequality).

Sometimes a graph says more than a thousand words …

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  1. Lars, This is interesting, but the problem I find with econometric data of this sort is that you are only modelling father’s income to the Gini. So what? Why not model the number of mothers at work to the Gini. The data completely ignores the cultural and societal dynamics and values. Are we showing that, yes, look at us Scandinavians and other northern Europeans, aren’t we great! Why don’t you buy what we have, our social institutions and values that date back to our agrarian reforms of the 1800s, our electoral reforms towards the end of 1800s, our education system, our recent legal reformation of corporate board structures, etc. Whose lens are we using to interpret the data? The data could be even more interesting if it included the countries on the Arabian peninsula, Pakistan, and Russia, but, as a whole, what is its value to inform policy?


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