Income Inequality and Scale Independence

December 10th, 2009
money, politics
Looking around at different ways of measuring income inequality (which I'm not convinced is a problem in and of itself: "people start startups in the hope of becoming much richer than they were before. And if your society tries to prevent anyone from being much richer than anyone else, it will also prevent one person from being much richer at t2 than t1") and I see that "scale independence" is valued in an income inequality metric. I'm not sure it should be. If you have a society and make everyone 2x richer, then a scale independent metric would say inequality hasn't changed. But what if you make everyone 1000x richer? Because the value of money is not linear in the amount you have (I would rather have a 50% chance of gaining $1M than a 25% chance of gaining $2M. Heck, I'd even prefer it to a 25% chance of gaining $3M.), as you scale incomes up inequality decreases. What I want is an income inequality metric that is explicitly scale dependent, considering along with each income the decreasing value of large amounts of money.

Comment via: facebook, substack

Recent posts on blogs I like:

Ozy at LessOnline!

I will once again be a guest at LessOnline, alongside many other writers whom you no doubt like less than you like me: Scott Alexander, dynomight, Georgia Ray, David Friedman, Nicholas Decker, Jacob Falkovich, Kelsey Piper, Alicorn, Aella, etc.

via Thing of Things March 23, 2026

Daycares and the Brown School

As someone in Somerville I notice that there are quite high prices regarding childcare. The average family in Somerville pays $1,100 to $3,500 for daycare per month, and I want to make the costs more affordable. I have also noticed that housing is quite …

via Lily Wise's Blog Posts March 22, 2026

2025-26 New Year review

This is an annual post reviewing the last year and setting intentions for next year. I look over different life areas (work, health, parenting, effectiveness, etc) and analyze my life tracking data. Highlights include a minimal group house, the usefulness…

via Victoria Krakovna January 19, 2026

more     (via openring)