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Two stories about inequality

February 6, 2015

In many rich countries the “hard” facts describing the income distribution are easily available. Yet, discussions about inequality are animated by two different stories with very different public policy implications.

You can listen to a caricature of these points of view in this pair of interviews on CBC radio: http://www.cbc.ca/radiowest/2015/01/21/two-different-takes-on-the-worlds-wealthiest-one-per-cent/

I offer more detail on the way Canadians have framed these stories as a part of a presentation to the School of Policy Studies at Queen’s university.

Here is Story 1 in pictures

(click on an image to start the slideshow and press Escape to return to this page).

Here is Story 2 in pictures

(click on an image to start the slideshow and press Escape to return to this page).

My presentation argued that context—rooted in economic theory and the appropriate use of statistics—is needed to understand the truth behind these stories, and to turn them into a conversation useful for public policy.

Here is the full set of slides I used.

Corak_Two_Stories_about_Inequality_and_Public_Policy_presentation_to_Queens_University_February_5_2015

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5 Comments
  1. Miles, thanks as always for the cogent analysis and insight. Why have the rates of LICO and LIM diverged in measuring poverty?

    • I will detail this in the associated paper that I am now writing. It has to do with the fact that Statistics Canada changed what the LICO means. Specifically, the LICO was no longer updated after 1992, before that it was updated every 5 years.

  2. Reblogged this on Multicultural Meanderings and commented:
    Good storytelling showing both pictures.

  3. Nalliah Thayabharan permalink

    Political shocks, institutional changes, and economic development play a major role in wealth inequality. I do not view r>g (return on capital -“r” – outpaces the growth rate of the economy -“g”- over time) as the only or even the primary tool for considering changes in income and wealth in the 20th century or for forecasting the path of inequality in the 21st century. Piketty’s r > g doesn’t adequately differentiate among different kinds of capital with different social utility. Some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by the facts, expresses a crude and naive trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system.

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