Thanks for the post. I’m often very surprised that people ignore income distribution when arguing about economics and welfare. Which leads me to ask: 1) which one is the best (or more robust) estimate of inequality-adjusted income for welfare analysis: median income or Gini-adjusted average income? Or they are supposed to converge (which does not seem to be the case, according to this article)? (I guess one advantage of Gini-adjustment is that it seems to be used in other welfare metrics, like HDI)
2) How relevant is wealth distribution—vis-à-vis income distribution? I can see how it’s important for distribution of power in society (if you’re comparing different groups, for instance), and I suppose wealth is important for one’s own life evaluation and as a hedge against uncertainty and economic shocks… but it’s hard for me to “put a number” on that.
Thanks for the post. I’m often very surprised that people ignore income distribution when arguing about economics and welfare. Which leads me to ask:
1) which one is the best (or more robust) estimate of inequality-adjusted income for welfare analysis: median income or Gini-adjusted average income? Or they are supposed to converge (which does not seem to be the case, according to this article)?
(I guess one advantage of Gini-adjustment is that it seems to be used in other welfare metrics, like HDI)
2) How relevant is wealth distribution—vis-à-vis income distribution? I can see how it’s important for distribution of power in society (if you’re comparing different groups, for instance), and I suppose wealth is important for one’s own life evaluation and as a hedge against uncertainty and economic shocks… but it’s hard for me to “put a number” on that.