Hacker News Reader

Comment by jasonkester | Hacker News Reader

I'd like to see that graph broken down between people who think that wealth is a zero sum thing that can be represented as a pie (as shown) vs those who know it isn't.

That is, people who think that if I have a dollar, then they can't also have that same dollar at the same time.

View on HN

"I'd like to see that graph broken down between people who think that wealth is a zero sum thing that can be represented as a pie (as shown) vs those who know it isn't."

Given that the "ideal" distributions are more or less the same across all other demographic slices, I doubt it would be substantially different. Which is good, because that argument doesn't stand up to even casual scrutiny.

The macroeconomic pie grows so slowly that it's not particularly meaningful to individuals on scales of less than a lifetime. When you actually look at the numbers [1], it's clear that rich people are getting richer at a much higher rate than poorer people are getting richer. Moreover, the average real household net worth has dropped substantially over the last decade, while the net worth of the richest has grown. No matter how you look at them, the numbers just don't support the "pie growth" hypothesis on anything other than an extremely long time scale.

[1] https://secure.wikimedia.org/wikipedia/en/wiki/Wealth_in_the...

I remember this from Hackers and Painters.

Money is a zero-sum game, wealth is not. So yes, I can't have the same dollar that you have.

I get a dollar, put it in the bank, which lends it to your company, which pays it to you.

It's sitting there on both your and my bank statement. We both have it at the same time.

Well, minus reserve requirements. :-)

Exactly! The pie is growing. Compare your wealth to your parents not your neighbors.

A deli manager at a grocery store in the Chicago area in 1985 made $35k - $40k a year. Adjusted for inflation, that was the equivalent of around $72k - $81k a year. With full benefits.

It's been clearly determined that wages have not kept up with inflation, so I would say that comparing one generation's wealth with their parents is not something that will yield hopeful results.

Is "full benefits" comparable across time? You couldn't buy 2010 medicine in 1985 at any price. Survival rates for a host of deadly diseases are much higher today.

Wealth != Inflation-adjusted dollars.

You can buy many things for $100 today that would have cost $5000 in 1985 (or more likely, that didn't exist at all). Life's necessities, with the important exception of homes and apartments, have gotten cheaper in inflation-adjusted dollars over time.

I'd argue that the truest measure of wealth is the distribution of 'happiness' over a population, but that opens so many cans of worms as to be near-useless. I'm guessing the average happiness has decreased over time, but I wouldn't chalk all that up to a decrease in inflation-adjusted dollars.

The things you mention are what inflation is meant to nullify. In an economists perfect world the amount of a normal good you can buy with $1 would be the same as the amount of that good you could buy for 1 inflation-adjusted dollar at any other time in history.

You're right, an inflation-adjusted dollar should buy some fixed fraction of e.g. a loaf of bread at any time in history. It's just such a multidimensional space that any one number is bound to leave out some pretty crucial information as to how much money a given person needs to be happy.

A grocery store deli manager in the mid-80's likely would have been a union member, especially in Chicago. It would be interesting to compare real wage changes in non-unionized vocations vs. highly unionized ones to tease out relative impact of macroeconomic changes vs. the decline of unions and their power to impart wealth transfer.

This is an excellent point. The decline of unions is probably one of the greatest reasons why wages have stagnated over the last 30 years.

Did a manager at a grocery store have the same amount of responsibility as today? My guess would be that today being a deli manager just means that you need to follow your chain's rule books. In 1985, with more independent stores and smaller chains, a manager had more responsibilities, and thus her contributions were more directly related to the store's profit than today. Thus a good deli manager is worth less than she used to be (and the really good people should work where they contribute more value, like creating the rules for deli managers in a chain).

While we're pulling reasons out of the air, I think that the difference in wages betwen '85 and today is /clearly/ because of Saturn's wobble.

That's a ridiculous comment. The reasons were not pulled out of thin air. Relative to the population, it seems likely that more people are qualified to become deli managers today than they were in 1985 due to standardization and advances in technology. If more people can do a job, it will receive less compensation.

At least be right if you're going to try to shoot down a comment with worthless sarcasm.

Really? Do you what percent of groceries stores we shop in today were around in 1985? Almost all of them. Same brands, same buildings, hell a lot of the people are the same too. My Dad was doing sales for Colgate and Nestle in 1970 and dealt with almost the exact same stores we have in our area today. A lot has changed in tech in 25 years, but the rest of the economy hasn't nearly as much. Last time I was at a deli counter, it was a bunch of meat and cheese that needed to be sliced and weighed by a bunch of teenagers. I don't think that has changed along the way at all.

I was born in 1985, so I don't really know how things were back then. I'm guessing more people actually used butchers and deli counters rather than picking up pre-packaged meat. I'm also guessing that it was harder to actually slice the meat since that's basically automated today.

Regardless, the original comment was fairly reasonable and didn't deserve the response it got.

So given companies competing in a certain market for market share, does it become harder as more entrants come into play?

If one has a monopoly, can others do just as well without detriment to the monopolist?

Reply on news.ycombinator.com