Inequality Issuization Metrics
This is a blog for poorcity.richcity.org. It also is the English language supplementary blog to blog.umverteilung.de. Topic: Inequality metrics.
A liberal and a conservative were sitting in a bar. Then Bill Gates walked in.
“Hey, we’re rich!” shouted the conservative. “The average person in this bar is now worth more than a billion!”
“That’s silly,” replied the liberal. “Bill Gates raises the average, but that doesn’t make you or me any richer.”
“Hah!” said the conservative, “I see you’re still practicing the discredited politics of class warfare.”
(Paul Krugman, International Herald Tribune, 2003-01-22)
For a 82:18 society (a society where 18% of its members own 82% of the resources and 82% of its members own 18% of the resources), the Theil redundancy (”symmetric Theil” in the graph) is 1. For 62:38 the Theil redundancy (red) minus the Hoover inequality (blue) reaches a minimum of -0.123.
Assumptions: At 62:38, the Redistribution (”Umverteilung” in German) occurs peacefully with an enjoyable intensity. For a lower differentiation of incomes, the majority of citizens in a free society would increasingly debate the question whether the distributive inequality is too low. Where the concentration of resources is higher than 62:38, the acceptance of resource distribution inequality gradually decreases. The cognition and issuization of inequality increases.
Other factors may come in, but I think that the difference between an inequality measure (Theil) for stochastic distribution processes (Theil) and an inequality measure (Hoover) for perfectly planned distribution processes could help to explain conflicts.