Tyler Cowen's new article on inequality is getting deserved attention. Money quote:
[T]he inequality of personal well-being is sharply down over the past hundred years and perhaps over the past twenty years as well. Bill Gates is much, much richer than I am, yet it is not obvious that he is much happier if, indeed, he is happier at all. I have access to penicillin, air travel, good cheap food, the Internet and virtually all of the technical innovations that Gates does. Like the vast majority of Americans, I have access to some important new pharmaceuticals, such as statins to protect against heart disease. To be sure, Gates receives the very best care from the world’s top doctors, but our health outcomes are in the same ballpark. I don’t have a private jet or take luxury vacations, andI think it is fair to saymy house is much smaller than his. I can’t meet with the world’s elite on demand. Still, by broad historical standards, what I share with Bill Gates is far more significant than what I don’t share with him.
While there’s simply no doubt that being wealthy or even in the comfortable professional upper middle class allows parents to confer untold advantages to their children, the differences between the well off and the fabulously rich are relatively modest. Going from making $30,000 to $60,000 in annual salary makes a profound difference. Doubling it again to $120,000 makes less difference in day-to-day lifestyle but does make nice vacations, private school for the kids, and other luxuries more easily affordable. Doubling it again to $240,000 may mean a second home and a fancier lifestyle.
But at some point it’s meaningless. Is Bill Gates living more lavishly than Tiger Woods?