This (relatively) Inegalitarian Isle | FT Alphaville

This (relatively) Inegalitarian Isle

This graph is from this powerpoint — part of a presentation by Alan Krueger, chairman of Obama’s Council of Economic Advisers.

So it has been used to illustrate American inequality and its effect on inter-generational social mobility. H/T P Krugman.

The Rise and Consequences of Inequality -- Alan Kueger

But my, it also says something about Britain and its enduring class system.

The vertical axis shows how much a one per cent rise in your father’s income improves your expected income – so the higher the number, the lower expected social mobility.  The horizontal measure is the Gini coefficient – a measure of inequality.

Of course, it’s important to put charts like this in perspective, which is why we should also consult Miles Corak, the University of Ottawa professor whose work has been used here by Krueger (and Krugman).

Here’s Corak’s unabridged Great Gatsby Curve.

Miles Corak's Great Gatsby Curve -- Economics for Public Policy

A rather different picture, innit?

Related links:
Inequality from generation to generation: the United States in comparison – Miles Corak