Tuesday

More on inequality and the problem of measuring it

A contact in Washington told me earlier this year that free healthcare is not included in the Gini calculations. I guess it would be a more accurate representation of inequality if it were.

What would the effect be? In Britain, I guess it might have a slight equalising effect on the measured contrast between high and low income people. In America, it might have quite a substantial effect since Medicaid is particularly for the less well off whereas those of means are expected to pay for themselves either directly or through their employers. I wonder if any research has been done on this?

And while we are at it, what about free education? In Britain, state education up to university is free and this would presumably have an equalising effect – especially as the richest pay for the education of their children. Something similar would apply in most advanced countries. In fact adding such things in would make a lot of the inequality statistics look a lot less dramatic.

And if one is looking at calculations of wealth inequality, it is perhaps arguable that rights to the state pension should be in the calculation of every person’s wealth. That would be an equalising factor, too.

  1. A few questions about measuring inequality
  2. The drive towards ‘lower inequality’
  3. Inequality: the final instalment with the benefit of a government statistic
  4. “Golden misses” – reasons why some women are not so keen on marriage
  5. Sweden, inequality and the unreliable Gini.
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