tag:blogger.com,1999:blog-2830084253401570472.post6859816151549069699..comments2024-03-28T09:22:36.967+13:00Comments on Offsetting Behaviour: Inequality narrative-busterEric Cramptonhttp://www.blogger.com/profile/15831696523324469713noreply@blogger.comBlogger9125tag:blogger.com,1999:blog-2830084253401570472.post-367658979037732722014-10-17T14:40:40.229+13:002014-10-17T14:40:40.229+13:00That's BHC and AHC income measures; query was ...That's BHC and AHC income measures; query was on wealth.Eric Cramptonhttp://offsettingbehaviour.blogspot.com/noreply@blogger.comtag:blogger.com,1999:blog-2830084253401570472.post-74720456508442531072014-10-17T10:32:37.054+13:002014-10-17T10:32:37.054+13:00Jim has this right, I think. Looking at inequality...Jim has this right, I think. Looking at inequality in finanical wealth but ignoring the capital that generates most of income (i.e. human capital), makes as much sense as looking at inequality in, say, cash balances, and ignoring bonds and shares. <br /><br /><br />Also, I would guess that the financial wealth stocks include housing, and much of the changes in the distribution of wealth reflect house price inflation and the differences in the proportion of households' portfolios that come from owner-occupied houses. The trouble is that, while financial assets return a monetary income that can be spent on anything, housing returns a flow of in-kind services. Equivalently, owning a house returns a financial flow that has to be spent on housing, and so different portfolios have to be deflated by different price indices that reflect the relative role of housing in the portfolio. <br /><br /><br />Best to not even suggest that wealth inequality is relevant at all. Anyone got any good data on consumption inequality?Seamus Hogannoreply@blogger.comtag:blogger.com,1999:blog-2830084253401570472.post-7241975582731454092014-10-16T21:56:27.045+13:002014-10-16T21:56:27.045+13:00And rising housing costs are in large part due to ...And rising housing costs are in large part due to over-regulation limiting land supply, and increasing cost of build. (For holiday house I've just paid consent work of $20,000 for a poxy renovation. When I got to $700 consent to simply replace 'existing' log burner, decided the old one will do well enough.)<br /><br />So freeing up land by deregulation, and returning us to capitalism the best solution for that Max.Mark Hubbardhttp://lifebehindtheirondrape.blogspot.co.nz/noreply@blogger.comtag:blogger.com,1999:blog-2830084253401570472.post-90357946666721842732014-10-16T19:45:15.943+13:002014-10-16T19:45:15.943+13:00From MSD 2014 - bryan perryFrom MSD 2014 - bryan perryJim Rosehttp://utopiayouarestandinginit.wordpress.comnoreply@blogger.comtag:blogger.com,1999:blog-2830084253401570472.post-25207048873130655752014-10-16T19:41:44.627+13:002014-10-16T19:41:44.627+13:00from Parry 2014from Parry 2014Jim Rosehttp://utopiayouarestandinginit.wordpress.comnoreply@blogger.comtag:blogger.com,1999:blog-2830084253401570472.post-71809811670659791192014-10-16T14:09:05.136+13:002014-10-16T14:09:05.136+13:00Might stencil this URL to my forehead and walk aro...Might stencil this URL to my forehead and walk around in public with it for a while.<br /><br />(If I had a point otherwise it would be to say, that income/wealth equality per se isn't a problem when living standards are rising for all.)Mark Hubbardhttp://lifebehindtheirondrape.blogspot.co.nz/noreply@blogger.comtag:blogger.com,1999:blog-2830084253401570472.post-71933988671853744562014-10-16T13:56:27.477+13:002014-10-16T13:56:27.477+13:00Agree that it's worth checking the data source...Agree that it's worth checking the data sources on the new report. <br /><br />I've focused on the post 80s changes because much of the current inequality narrative has presented the increase from the 80s to present as an ongoing trend rather than a sharp rise followed by a flatlining. A lot of people seemed to be deliberately mischaracterising the data to make the case that inequality was worsening, rather than that it did worsen a couple of decades ago. Again, I will quote from the MSD report: "Overall, there is no evidence of any sustained rise or fall in inequality in the last two decades."Eric Cramptonhttp://offsettingbehaviour.blogspot.com/noreply@blogger.comtag:blogger.com,1999:blog-2830084253401570472.post-91500721429567855492014-10-16T13:17:39.107+13:002014-10-16T13:17:39.107+13:00I'd be a bit more cautious, personally.
Firs...I'd be a bit more cautious, personally. <br /><br />First, when you claim "nothing much has happened" with income inequality since the early 90s, you don't just get people on Twitter saying we should talk about wealth. You also get me pointing out that, firstly, that's not true: income inequality continued to rise until the early 2000s, whereupon it fell slightly and thanks only to deliberate actions like Working for Families, so plenty "has happened", in both directions; and, secondly, to concentrate your narrative on what happened *after* a period in NZ that represented the developed world's biggest increase in income gaps gives a very partial picture, to say the least, of how the country's changed.<br /><br />Second, the Credit Suisse report seems to be based on Reserve Bank household wealth data. I've never seen anyone use that to estimate wealth shares before, and it's not clear from the report (or accompanying databook) how they've arrived at their estimates. Nor do their figures match up with what little we know about wealth inequality from other sources. So I certainly won't be "updating my narrative" until I've had a careful, rigorous look around the data - as I'd expect others to do.Max Rashbrookehttp://www.inequality.org.nz/noreply@blogger.comtag:blogger.com,1999:blog-2830084253401570472.post-88917626590998335222014-10-16T13:16:54.343+13:002014-10-16T13:16:54.343+13:00Nice post. What about human capital, which is 70%+...Nice post. What about human capital, which is 70%+ of all wealth. Gibson and Li estmated nz human capital at $800bJim Rosehttp://utopiayouarestandinginit.wordpress.comnoreply@blogger.com