Wealth is Relative

[pvn]

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Thanks for reading and I hope this made sense.

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It makes sense, but when you compare a farmer with good soil to one whose soil is poor, you're still comparing one farmer to another, and calling one wealthy and one poor only makes sense within that context.

If a farmer has no animals, and acquires a cow, he's better off -- but the comparison is between his former status and his current one. It's still a relative measure.

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Of course when you say one is "better off" you are making a relative comparison.

LDO.

This is different than talking about wealth.

[John Kilduff]

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Thanks for reading and I hope this made sense.

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It makes sense, but when you compare a farmer with good soil to one whose soil is poor, you're still comparing one farmer to another, and calling one wealthy and one poor only makes sense within that context.

If a farmer has no animals, and acquires a cow, he's better off -- but the comparison is between his former status and his current one. It's still a relative measure.

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Yes, it's a relative measurement, but the fact that you don't need a third party for the comparison shows that wealthiness is not just a comparison based on wealth relative to others. So, the farmer who gets his first cow should be happier even if there were no other farmers in the world for him to compare himself to. His family will be better off, too, and will be able to drink milk and have cheese [img]/images/graemlins/wink.gif[/img]

[LinusKS]

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So what's the problem of poverty? Is it problematic because some human beings must slave in barbaric conditions for twelve hours a day just to acquire a bowl of rice and another day of life, or because they are "unequal" to those better than them?

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Good question. My point is that only part of the misery of working 12 hours a day comes from long hours.

The other part of it (and perhaps the more important part) is that you're working 12 hours a day for someone who doesn't have to work at all, and still eats better than you.

In other words, inequality, in and of itself, is problematic.

I disagree, btw, that not having to work makes you "better than" those who do. But that's part of the problem - that so many of the people who are fortunate are so distainful of those who are not.

[LinusKS]

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I totally agree with this and I think lots of recent psychological research on "happiness" and GDP and economic psychology bears this out. I will possibly make the argument at some point that I was suggesting that Linus consider making (because I think it is what he is intuitively and astutely referring to) but I think /both/ absolute wealth and relative wealth factor into subjective wellbeing, and I would argue that at a certain level absolute wealth is more important and once surpassed, relative wealth becomes /much/ more important to subjective wellbeing/quality of life and that an ideal socioeconomic system would maximize quality of life for all people in that system.

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Again, nice way of saying it. Thanks.

One study I remember had to do with sisters. They found that if a woman had a sister whose husband made more than her husband did, she was more likely to work than one who did not.

Edit: in other words, how much was "enough" was influenced by how much other people had, not by what she had herself.

[TomCollins]

People cannot want goods they do not know exist. If my neighbor buys a flying car, I am not worse off, but I certainly would want one. If this means I would have to work 2 jobs to be able to afford one, I might decide it is worthwhile. However, I am not worse off if I decide not to. Certainly I am not worse off than I was before.

[LinusKS]

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So let me get this straight. You believe that a society of people who live the quality of life equivalent of $1,000 a year, but everyone has the exact same amount, are better off than those where the poorest live the quality of life equivalent of $100,000 but some have billions?

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I believe that the people in the "poor" society are happier than the poor people in the second society, regardless of how much money they have.

And I think it's more or less verifiable.

If you take studies from the 50's, for example, you'll find that people then were no less happy than people today, even though we have far more money.

And I'd wager that an average income worker of the 50's was better off (happier) than poor people today, even though poor people today may have more stuff than the average worker from the fifties.

[TomCollins]

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So let me get this straight. You believe that a society of people who live the quality of life equivalent of $1,000 a year, but everyone has the exact same amount, are better off than those where the poorest live the quality of life equivalent of $100,000 but some have billions?

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I believe that the people in the "poor" society are happier than the poor people in the second society, regardless of how much money they have.

And I think it's more or less verifiable.

If you take studies from the 50's, for example, you'll find that people then were no less happy than people today, even though we have far more money.

And I'd wager that an average income worker of the 50's was better off (happier) than poor people today, even though poor people today may have more stuff than the average worker from the fifties.

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What units is happiness measured in? How do you measure it? Do you put them on a scale? Is there a happiness machine they walk into that can measure it?

[latefordinner]

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What units is happiness measured in? How do you measure it? Do you put them on a scale? Is there a happiness machine they walk into that can measure it?

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This is like the 4th time this has come up in this thread.

There are plenty of ways to operationalize qualitative constructs and measure them but it is a total non-sequitor anyway. Even if we can't measure a qualitative state like "happiness" that doesn't mean it doesn't exist and that it isn't more important in quality of life than a measure like GDP which might be easier to measure certainly, but that doesn't somehow make it more important to maximize.

[pvn]

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Is there a happiness machine they walk into that can measure it?

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Happiness machines are awesome.

[AlexM]

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So let me get this straight. You believe that a society of people who live the quality of life equivalent of $1,000 a year, but everyone has the exact same amount, are better off than those where the poorest live the quality of life equivalent of $100,000 but some have billions?

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I believe that the people in the "poor" society are happier than the poor people in the second society, regardless of how much money they have.

And I think it's more or less verifiable.

If you take studies from the 50's, for example, you'll find that people then were no less happy than people today, even though we have far more money.

And I'd wager that an average income worker of the 50's was better off (happier) than poor people today, even though poor people today may have more stuff than the average worker from the fifties.

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OK, I'm sorry, but this is so obviously untrue that your belief in it just makes you seem insane to me. Every day when thinking about things that are wrong with my life I think "well, at least I have toilet paper" or "at least I'm not slaving in the hot sun all day" or "wow, I sure love that I live in a time where I have running water" or "gee, this refrigerated food sure is great" or "man, people must have been so bored without television and video games". EVERY DAY. To suggest that most people are completely ignorant of these things is completely incomprehensible to me. Especialy when it comes to things that are new within our lifetimes like the Internet and video games. All of these things and thinking about them makes me happier than I would be if not for these things. There's simply no question about it.