Inequality is better

Here's an interesting slant on inequality from the Institute of Economic Affairs:

Earlier this year, the Work Foundation published a study of inequality in Britain that threw up some uncomfortable findings for those who believe that income differentials are the root of all evil. The hypothesis put forward in The Spirit Level is that greater income equality fosters health and happiness while inequality is a direct cause of misery and unrest. ‘If you want to live the American dream,’ says Spirit Level co-author Richard Wilkinson, ‘you should move to Finland or Denmark’. But why travel so far? Inequality varies greatly within countries and so, since wealth disparities are most visible at the local level, moving to a more equal city should yield benefits.
The Work Foundation shows us exactly where these pockets of egalitarianism are. The most equal city in Britain turns out to be Sunderland, followed by such places as Bradford, Peterborough and Burnley. The least equal city is London, followed by the likes of Reading, Guildford and Milton Keynes. For the most part, inequality is concentrated in the wealthy south east of England and, as the study notes, ‘cities with high median wages almost always tend to have high inequality.’ The more equal cities, on the other hand, ‘tend not to be very affluent’. This trade-off between wealth and equality will come as no surprise to economists, but it is reassuring to know that the wealth in the less equal places trickles down.

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