The Impact of Inequality and Need for Economic Democracy

This weeks read has been Richard Wilkinson and Kate Pickett’s latest (2018) book – The Inner Level. This text maps the social and psychological processes that mean that income inequality diminishes wellbeing – a fact they evidenced in their first book, The Spirit Level (2007).

The collate huge evidence bases for the worsening of all of the following issues in countries where income inequality is widest (pp268-272):

  • Life expectancy
  • Infant mortality
  • Adult mortality
  • Obesity
  • HIV infection
  • Mental illness (all)
  • Depression
  • Schizophrenia
  • Psychotic symptoms
  • Status anxiety
  • Narcissism
  • Substance use or deaths
  • Problem gambling
  • Trust / social capital
  • Solidarity
  • Agreeableness
  • Civic participation
  • Cultural participation
  • Ambiguous stereotyping (bastards but contribute to economy)
  • Social comparisons
  • Imprisonment
  • Women’s status
  • Child wellbeing
  • Bullying
  • Child mistreatment
  • Educational attainment
  • Dropping out of school
  • Social mobility
  • Teenage pregnancy
  • Biodiversity
  • Water /meat / petrol consumption
  • Air pollution
  • Status consumption
  • Compliance with international environmental agreement

How can we look on whilst these blight our lives?

girl s white and gray crew neck top holding gray wire fence
Photo by namo deet on

They identify some key reasons for these issues escalating:

Inequality makes problems with social gradients worse – it increases the prevalence of almost all socially graded problems such as health etc as shown above P232-33

Inequality affects social mixing – it reduces social mobility and increases segregation. P233-34

Inequality affects social cohesion – as cohesion drops so status anxiety increases with inequality – people are more judgemental, more anxious of comparison and put down, and this increases the prevalence of coping mechanisms – eating, not going out, drink, drugs et. P234

Inequality increases anxieties about status – low self esteem and low confidence result from the social anxiety. This increases depression and other diagnosable psychological disorders. This includes self-aggrandisement and narcissism, and disdain for anyone of a lower rank P234-35

Inequality heightens consumerism and consumption – people use money to show that they are worth and so endlessly buy status symbols. Increased working hours and debt to accrue those goods p235-36.

So what do we do about it? Wilkinson and Pickett recommend moving to a Democratic Economy. This would include tax reforms, end to tax evasion, co-operatives, employee representation on boards, employees as stakeholders, (these have been proved to boost productivity and to be more innovative), with countries striving to increase GDP through business models that benefit all rather than solely benefitting the rich. Such models would even income inequality and enable countries to afford increased welfare p244-251.

The current massive differentials in pay, lack of employee voice and lack of control in organisational life makes employees feel disaffected and stressed as they generate wealth for their ‘owners’ p250-51.

They suggest an easy step would be to create a ‘Democratic Company’ movement like ‘Fairtrade’ p256.

These are interesting ideas. I have certainly noted and believe the negative impact of income inequality such as they mapped in The Spirit Level. It has been interesting to read the links between inequality and the phenomenon’s it produces in this book. What this text has really achieved, in my opinion however, is to start to generate clear and simple actions every organisation globally can put in place to create more equality. It is not just a political issue that only governments can address, it is within many more people’s gift. That said, campaigning and taking action politically is still important so that some of these changes can be legislated for.

To that end, i am proposing to establish an Inequality Group in line withe the Inequality Trust, to meet twice a year at the University of Cumbria Lancaster and Carlisle campus. I envisage creating a democratic space for like minded people to meet, discuss issues and solutions, and who knows what else from there. If anyone is interested in joining, please let me know and I will set up dates.


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