Rich Get Richer, Poor Get Richer. Is Everybody Happy?
In today's Wall Street Journal, Arthur C. Brooks looks again at the scholarship on inequality and unhappiness[$].
He opens with these stats: "According to Census figures, the average inflation-adjusted income in the top quintile increased 22% between 1993 and 2003. Incomes in the middle quintile rose 17% on average, while the incomes in the bottom quintile increased 13%." In short, the rich are getting richer, but it's not zero sum. The poor are getting richer, too, albeit a little more slowly. But does getting richer slower take all the pleasure out of it? After all, as one famous experiment found:
56 percent of participants chose a hypothetical job paying $50,000 per year while everyone else earned $25,000, rather than a job paying $100,000 per year while others made $200,000. Thus, the thinking goes, the very fact that some people have less than others leads to unhappiness, even without deprivation.
But egalitarians, says Brooks, read the experimental evidence incorrectly. They see in these results a desire for a more equitable distribution of income. But:
The stud[y] above doesn't necessarily tell us that people would be happier in a world of total equality. Rather, they indicate that if there is no apparent prospect for getting ahead themselves (as there indeed was not in the experiment), people will focus instead on having more than others–even to the point of neglecting their financial interests.
What matters in real life, says Brooks, is opportunity. He backs this up with happiness stats over the last 30 years, which show that about 30 percent of people have consistently described themselves as "very happy," even as income disparities have grown significantly. What hasn't changed is mobility: In any given period, about half of people in the bottom quintile will rise out of it within a decade, a fifth within a year.
reason ran an interview with Brooks in our March print issue, and I wrote about him here as well.