Perception vs. Reality: Revisiting Wealth Inequality in America

This past summer, I wrote a post that shared some information about wealth inequality in the US. I was actually sharing information that had been published the summer before (in 2011). There was a telling graphic that followed as a result of the study (I’ve included it below): Average Income by Family, distributed by income group.

Keeping in mind that this study was published in 2011, so the three boxes may have shifted. If anything, I would imagine that the actual distribution (the top box) is more pronounced in its inequality and because of Occupy Wall Street and books like Chrystia Freeland‘s Plutocrats (which I’m currently reading and will probably have a post on in the near future), I would guess that people would be more aware of the wealth inequality, so the middle box would also be more pronounced in its inequality.

The reason that I decided to revisit this information is because there’s a video that’s being passed around that uses the information from this study (and this graphic) and presents it in a much more effective way. Before reading on, I’d urge you to watch it:

Now, can you see how much more effective that is in accentuating the differences between perception and reality? I especially appreciated the way the creator of the video used the an aggregate of 100 people to illustrate the differences between the percentiles. I’ve found that when numbers get really large, it can be hard for people to conceptualize the differences. For instances, if we look at the graphic above (in this post), the differences are plain to see, but there’s something about the limits of the rectangle. The representation of the quintiles don’t make for easy transferability from one quintile to the next. That is, it might be hard for to conceptualize that each of those colors is suppose to represent 20% of the population. In watching the video, though, the creator so eloquently differentiated between quintiles by taking an aggregate of 100 people and then actually showing the people from each group.

I think the video was really well done and I hope that it raises public awareness around this important issue. More than that, I hope that it motivates the public to actually want something to get done. If enough of the population pressures their legislators, we just might be able to make a change.

Published by Jeremiah Stanghini


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  1. One of the co-authors of the study responded to the video above and thought that it did a great job covering the main findings. There was one thing that Ariely thought was important that wasn’t emphasized in the video:

    “The only thing I wish he emphasized a little more is how similar the results were for Democrats and Republicans, which I found very hopeful. Even with all the ideological polarization in Washington, the moment we ask the question of ideal wealth distribution in a general and less self-interested way, we seem to be a country that cares a lot about each other.”


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