TEDx Talk

We helped Harvard College launch their student-led TEDx program.

A social scientist compares the perceptions, ideals and realities of the distribution of global wealth across the full spectrum of socioeconomic categories of people.

Michael Norton | Spreading the Wealth

Transcription: So let’s start with wealth. So think about America as everyone and then divide it into 20 percents, the richest 20%, the next richest, next, next, down to the poorest 20% and come up with a number in your mind right now, for example, what do you think the richest 20% of Americans have in terms of all the wealth, do the next one, the next one, the next one, the next one all the way down to what do you think the poorest 20% of Americans have. We asked a sample of over 5,000 Americans what they thought from all over different income groups, gender, ethnicity, everyone we could find in the US. We asked them the same question. Here’s what they told us. Just to orient you, the blue bar, that’s the biggest one, are people’s estimates of how much wealth the top 20% of Americans have and they think they have about 60% of the wealth. Then, think about the bottom 20%. Americans told us they thought they had not much, 3-4% of the wealth. They really understood there’s a lot of inequality in the United States. This is certainly not an equal distribution. Now, answer these questions. If it were up to you, what should the richest 20% of Americans have, the next, the next, the next, all the way down to what should the poorest 20% of Americans.

People thought the ideal distribution was much more equal than what they thought the distribution was. They thought that the richest 20% should have about 36 to 40% usually when we ask them. They thought the poorest 20% should have about 10%. What’s interesting, is people don’t say everyone should have the same amount, so we don’t have some theory that if everyone had not the same height, not the same amount of wealth, most people tell us no, no, there can be rich people and poor people, but just less extreme than they estimated it to be. What’s most striking, I think, about this chart, is I’m going to show you what reality is. What you can see is that the top 20% of Americans estimates vary, but they have something like 80 to 85% of all the wealth. You might be looking for the purple and the light blue line. The reason they’re not there is not because I’m bad at making graphs, although I am bad at making graphs, it’s because they have so little that they don’t even show up. So the bottom 40% of Americans have about 0.3% of the wealth, something like that. Really drastic differences here. People think it’s more equal than it actually is and they’d like it in their ideal, for it to be even more equal than that.