Robert_Wiblin comments on How accurately does anyone know the global distribution of income? - Effective Altruism Forum

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Comment author: Robert_Wiblin 12 April 2017 06:18:16AM *  2 points [-]

Here are some other thoughts off the top of my head. As I see it there are different points this figure could be used to support:

i) The social impact of someone earning, e.g. $100k a year, is potentially quite large, as they are earning more than the global average, making them unusually powerful.

ii) It's high-impact to help people in the developing world because many people are so very poor.

iii) This high level of inequality is an indication of a deep injustice in the economic system that needs to be resolved.

It seems like some folks are particularly worried about the graph being used to support the third point. But I can't actually recall anyone in EA circles using it to make that case (though I think one could try). Our workshop notes that some in the audience may see things that way, but then works to remain neutral on the topic as it would be a big debate in itself.

Point i) seems best measured by someone's disposable income as a fraction of total global disposable income, or at least the average global disposable income.

Point ii) is best made by the ratio of the income of our hypothetical donor to that of someone at the 10th percentile (e.g. or whatever income percentile is the beneficiary of marginal work by GiveDirectly or AMF). Despite outstanding income growth in the middle of the distribution, IIRC the 10th percentile's income hasn't risen much at all. It remains around the minimum subsistence level. With graduate incomes rising in the US, this ratio has probably increased since 2008. Whether this ratio is 30, 100 or 300 is one factor relevant to how good the opportunities look in poverty reduction as a cause relatively to others (what the ratio is and how much that matters is discussed in thejadedone's thread). We turn to this ratio later in our career guide, and recently did a fact check on the incomes of GiveDirectly recipients.

Interestingly, the ratio of a reader’s income to the global median doesn’t seem the best measure for any of these purposes.