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Socioeconomic inequality matters because it strengthens the belief that some people are worth much more than others. Those at the top seem hugely important and those at the bottom are seen as almost worthless. In more unequal societies we come to judge each other more by status and worry more about how others judge us. Research on 28 European countries shows that inequality increases status anxiety in all income groups, from the poorest ten percent to the richest tenth. The poor are affected most but even the richest ten percent of the population are more worried about status in unequal societies

being at the bottom of the social ladder feels the same whether you live in the UK, Norway, Uganda or Pakistan. Therefore, simply raising material living standards is not enough to produce genuine wellbeing or quality of life in the face of inequality

Psychotic symptoms such as delusions of grandeur are more common in more unequal countries, as is schizophrenia. As the graph below shows, narcissism increases as income inequality rises, as measured by ‘Narcissistic Personality Inventory’ (NPI) scores from successive samples of the US population.

Those who live in more unequal places are more likely to spend money on expensive cars and shop for status goods; and they are more likely to have high levels of personal debt because they try to show that they are not ‘second-class people’ by owning ‘first-class things.’

by examining our evolutionary past and our history as egalitarian, cooperative, sharing hunter-gatherers, we dispel the false idea that humans are, in their very nature, competitive, aggressive and individualistic. Inequality is not inevitable and we humans have all the psychological and social aptitudes to live differently.

inequalities of outcome limit equality of opportunity; differences in achievement and attainment are driven by inequality, rather than being a consequence of it

inequality is a major roadblock to creating sustainable economies that serve to optimise the health and wellbeing of both people and planet.  Because consumerism is about self-enhancement and status competition, it is intensified by inequality. And as inequality leads to a societal breakdown in trust, solidarity and social cohesion, it reduces people’s willingness to act for the common good. This is shown in everything from the tendency for more unequal societies to do less recycling to surveys which show that business leaders in more unequal societies are less supportive of international environmental protection agreements.

The UK charity we founded, The Equality Trust, has resources for activists and a network of local groups. In the USA, check out inequality.org. Worldwide, the Fight Inequality Alliance works with more than 100 partners to work for a more equal world. And look out for the new global Wellbeing Economy Alliance this autumn.

Inequality creates the social and political divisions that isolate us from each other, so it’s time for us all to reach out, connect, communicate and act collectively. We really are all in this together. 

intellectual overextension is often found in economics, as Gary Saul Morson and Morton Schapiro explain in their wonderful book “Cents and Sensibility: What Economics Can Learn from the Humanities” (Princeton). Morson and Schapiro—one a literary scholar and the other an economist—draw on the distinction between hedgehogs and foxes made by Isaiah Berlin in a famous essay from the nineteen-fifties, invoking an ancient Greek fragment: “The fox knows many things, but the hedgehog one big thing.” Economists tend to be hedgehogs, forever on the search for a single, unifying explanation of complex phenomena. They love to look at a huge, complicated mass of human behavior and reduce it to an equation: the supply-and-demand curves; the Phillips curve, which links unemployment and inflation; or mb=mc, which links a marginal benefit to a marginal cost—meaning that the fourth slice of pizza is worth less to you than the first. These are powerful tools, which can be taken too far. Morson and Schapiro cite the example of Gary Becker, the Nobel laureate in economics in 1992. Becker is a hero to many in the field, but, for all the originality of his thinking, to outsiders he can stand for intellectual overconfidence. He thought that “the economic approach is a comprehensive one that is applicable to all human behavior.” Not some, not most—all

Becker analyzed, in his own words, “fertility, education, the uses of time, crime, marriage, social interactions, and other ‘sociological,’ ‘legal,’ and ‘political problems,’ ” before concluding that economics explained everything

The issue here is one of overreach: taking an argument that has worthwhile applications and extending it further than it usefully goes. Our motives are often not what they seem: true. This explains everything: not true. After all, it’s not as if the idea that we send signals about ourselves were news; you could argue that there is an entire social science, sociology, dedicated to the subject. Classic practitioners of that discipline study the signals we send and show how they are interpreted by those around us, as in Erving Goffman’s “The Presentation of Self in Everyday Life,” or how we construct an entire identity, both internally and externally, from the things we choose to be seen liking—the argument of Pierre Bourdieu’s masterpiece “Distinction.” These are rich and complicated texts, which show how rich and complicated human difference can be. The focus on signalling and unconscious motives in “The Elephant in the Brain,” however, goes the other way: it reduces complex, diverse behavior to simple rules.

“A traditional cost-benefit analysis could easily have led to the discontinuation of a project widely viewed as being among the most successful health interventions in African history.”

Another part of me, though, is done with it, with the imperialist ambitions of economics and its tendency to explain away differences, to ignore culture, to exalt reductionism. I want to believe Morson and Schapiro and Desai when they posit that the gap between economics and the humanities can be bridged, but my experience in both writing fiction and studying economics leads me to think that they’re wrong. The hedgehog doesn’t want to learn from the fox. The realist novel is a solemn enemy of equations. The project of reducing behavior to laws and the project of attending to human beings in all their complexity and specifics are diametrically opposed. Perhaps I’m only talking about myself, and this is merely an autobiographical reflection, rather than a general truth, but I think that if I committed any further to economics I would have to give up writing fiction. I told an economist I know about this, and he laughed. He said, “Sounds like you’re maximizing your utility.” 

finance is full of “attribution errors,” in which people view their successes as deserved and their failures as bad luck. Desai notes that in business, law, or pedagogy we can gauge success only after months or years; in finance, you can be graded hour by hour, day by day, and by plainly quantifiable measures. What’s more, he says, “the ‘discipline of the market’ shrouds all of finance in a meritocratic haze.” And so people who succeed in finance “are susceptible to developing massively outsized egos and appetites.”

one of the things I liked about economics, finance, and the language of money was their lack of hypocrisy. Modern life is full of cant, of people saying things they don’t quite believe. The money guys, in private, don’t go in for cant. They’re more like Mafia bosses. I have to admit that part of me resonates to that coldness.

Economics, Morson and Schapiro say, has three systematic biases: it ignores the role of culture, it ignores the fact that “to understand people one must tell stories about them,” and it constantly touches on ethical questions beyond its ken. Culture, stories, and ethics are things that can’t be reduced to equations, and economics accordingly has difficulty with them

There is something thrilling about the intellectual audacity of thinking that you can explain ninety per cent of behavior in a society with one mental tool

According to Hanson and Simler, these unschooled workers “won’t show up for work reliably on time, or they have problematic superstitions, or they prefer to get job instructions via indirect hints instead of direct orders, or they won’t accept tasks and roles that conflict with their culturally assigned relative status with co-workers, or they won’t accept being told to do tasks differently than they had done them before.”

The idea that Maya Angelou’s career amounts to nothing more than a writer shaking her tail feathers to attract the attention of a dominant male is not just misleading; it’s actively embarrassing.