A race of dwarves and giants: visualising income inequality

The scary thing about the following is that it’s now an underestimate. So, start reading:

Imagine that we live in a world in which, owing to genetic mutation, income translates directly into height. The richer you are, the taller you are. Then imagine that the entire population of Britain marches past you, in the course of an hour, ranked in order of their income. What sort of procession would you see?

After three minutes the walkers would be 2ft tall. After a quarter of a hour they would still be dwarfs, of about 3ft; they would reach 4ft after 24 minutes. You would have to wait until 37 minutes before a person of average height, about 5ft 8in, walked by. In the final quarter of an hour, abnormally large people, more than 7ft in height, would start appearing.

With three minutes left, people of twice average height would be passing by. In the final minute, the figures would be giants 30 yards high. Yet even they would not be the biggest. In the hour’s closing seconds, a small number of super-earners would walk past: each would be earning pounds 1m a year or more – and thus each would be at least 235 yards tall. These freakish beings – top barristers, leading City analysts, a few chief executives as well as stars in the entertainment industries – are the products of a society that is increasingly organised in a new, freakish way.

This comes from “How fat cats rock the boat“, by Charles Leadbeater – when he was deputy editor at The Independent. Guess when it was written?

November, 1996. Since then, income inequality has got worse.

It’s one of the most insightful pieces I’ve ever read on how celebrity culture feeds on itself:

In theory competition should make it more difficult for a small elite to charge excessively high prices and make monopoly profits. Yet in fact more competition helps such elites. In highly competitive markets there is a premium on perceived value – on standing out from the competition by looking distinctive; after price, the biggest influence on consumer choice is brand. So those people and companies that are particularly good at marketing, advertising and self- promotion will tend to do better, everything else being equal. Success will breed success, celebrity will beget celebrity.

Thus, in television a handful of comedians have cornered the market in light entertainment, becoming a self-perpetuating elite. And, of course, celebrities like to deal with other celebrities; that is a symbol of their status.

If you are a film celebrity, you want your divorce handled by a celebrity divorce barrister, your hair done by a celebrity cutter, your home decorated by a celebrity designer and so on. As well as being more competitive, however, markets for many goods, whether they are computer games, books, films or legal services, are becoming more international. And larger markets mean larger rewards for the people who win. Being a winner in a purely local market – a school sports day – might bring you a small cup; winning in a global market – the Olympics – brings you vast rewards.

Remember, this was all before the rise of magazines like Heat. But it shows why they rose: because we focus on those at “the top” or near it, and that attention begets more attention. But it also has dramatic effects on income inequality.

1 Comment

  1. Just to say, that explaining inequality using the image of processing dwarves and giants is a lot older than 1996. I first read it in the 70s in one of those handy Pelicans. I’m guessing it was in Peter Donaldson’s guide to the British Economy. Something like it.

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