Wealth Distribution. Thinking about the world around us.

Think for a minute about who owns how much stuff in the United States.

Rather than stuff, I'll refer to wealth, which I'm defining as net worth, which is assets - liabilities.


Think about shape of the distribution of wealth, where the horizontal axis ranges from very, very poor, poor, average wealth, middle class, rich, super rich.

Draw pictures of the types of distributions you're familiar with (normal, skewed left, skewed right, bimodal).

Which of these would you consider to be a "fair" distribution of wealth? Think about the spread between those who have a lot of wealth and those that don't have much.
Does it matter whether the distribution is rather narrow or rather wide? What does this mean?



Now that you've got some of your own ideas about wealth distribution in the US, the mean US wealth in 2001 was
$397,533 and the median wealth was $87,200. What does this distribution look like?
Here's a chart of the distribution of wealth in the US.


What does this distribution tell you in terms of who owns what in our society?


Here's some other info regarding wealth in the US. It contains mean and median wealth for households where the head of the household is white and not white, female and not female, and by the age of the head of the household. (it's in a .pdf file)




Economists measure this using a measure called the Gini coefficient. The Gini coefficient measures extent to which the distribution of income among households within a country deviates from a perfectly equal distribution.


The United Nations publishes information about the distribuiton of income in their Human Development Reports. This page has a table listing 177 countries and their Gini coefficients.

Which of these countries has the most even income distribution? United States, Norway, Greece.
Is there anything surprising about the list of countries? Any trends? What do you notice about the countries near the top of the list? Where is the United States in relation to these countries? Any explanations for the differences in rankings?


Which of these countries has the most uneven income distribution? United States, Sierra Leone, India. Why do some countries appear towards the bottom of the list? What do these countries have in common?