Mean and median are two measures of “average.” The mean is the average as we typically think of it: the sum of things divided by the total number of things. The median, in contrast, is literally the number in the middle if we align all the quantities in order. People often use median instead of mean because it is insensitive to extreme outliers which may skew the mean in one direction or another.
For a quick illustration of the difference, I often use the example of income. I choose a plausible average (mean) for the classroom population and review the math. “If Bill Gates walks into the room,” I say, “the average income is now in the billions. The median hasn’t moved, but the mean has gone way up.” So has the Gini coefficient.
Here’s a more realistic and global illustration – the net worth of people in the wealthier countries. The U.S. ranks fourth in mean worth – $301,000 per person…
…but the median is far lower – $45,000, 19th out of the twenty nations shown. (The graph is from Credit Suisse via CNN.)
The U.S. is a wealthy nation compared with others, but “average” Americans, in the way that term is generally understood, are poorer than their counterparts in other countries.
This chart comes from Chuck Marr at the Center on Budget and Policy Priorities. As Marr explains:
The United States is a relatively low-tax country, as the chart shows. When measured as a share of the economy, total government receipts (a broad measure of revenue) are lower in the United States than in any other member of the Organization for Economic Co-operation and Development (OECD), even after accounting for the modest revenue increases in the 2012 “fiscal cliff” deal and the taxes that fund health reform.
by Jennifer Hickes Lundquist PhD and Eiko Strader, Sep 13, 2013, at 12:00 pm
Excess under age-60 female mortality in less developed countries is estimated to add up to 3.9 million missing women worldwide (World Bank, 2011). A large proportion of this is due to sex-selective abortion practices. The practice occurs most commonly among poorer families in societies where boy children are given greater economic and social status than girl children. In such a context, the transition to smaller families can lead parents to choose boys over girls. Notably, female fetuses are most likely to be aborted when the first child born is a girl.
The table below shows the countries with the most skewed ratios at birth in the world. While there is naturally a slightly higher sex ratio of boys to girls — between 1.04-1.06 — ratios above that are considered to be altered by technology due to gender preferences for boy children.
The reason we find this newest 2013 data of particular interest is that, despite the popular Western focus on Asia, the practice occurs in more European countries. Perhaps most striking is the central European country that ranks at the top of the list—Liechtenstein. This strikes us as odd, given that Liechtenstein has never made this list in the past. Perhaps this is a data collection error (in very small populations, as also in Curacao, the results can be skewed). But we are surprised that no journalists have picked up on the fact that the worst offending son-preference country in the world is now, allegedly, a European country. We contacted the CIA to ask them about this possible data anomaly but have not yet heard back.*
On the other hand, if the Liechtenstein data is accurate, this would be a very interesting story indeed, especially since Liechtenstein has the most restrictive laws against abortion in Europe. A quick scan of gender equity policies in Liechtenstein shows that women there were not legalized to vote until 1984, indicating that it is not the most gender egalitarian of European countries.
In any case, whether Liechtenstein’s inclusion in this disreputable list is a data error or not, the other European countries on the list are legitimate. They have been high for many years, and a recent report on Armenia, for example, documents longstanding norms in gender preference. The disproportionate focus on birth sex ratios in China and India no doubt reflects their status as the #1 and #2 most populous countries, which means a much greater overall impact in sheer numbers. Nevertheless, our point stands. Why has the disproportionate inclusion of non-Asian countries on the above-list gone virtually unmentioned by journalists?
Do Developed Western Countries Prefer Boys?
Americans often think of parental sex preference as a thing of the past, or a problem in developing countries. After all, the U.S. sex ratio at birth falls in the normal range, at 1.05. This is in spite of the curious American cottage industry in sex-identification home use kits, such as the Intelligender, the GenderMaker and the Gender Mentor.
In surveys, American parents report an ideal of two children and equal preference for boys and girls. However, American gender preferences manifest themselves in more sneaky ways. A 2011 Gallup poll showed that, if they were only able to have one child, the highest preference was for a boy. These results are little changed from the same Gallup question asked of Americans in 1941.
To return to a point made in an earlier post on skewed sex ratios, Americans may not be so different, after all, in their gender preferences from the countries in the above table. The crucial difference, she noted, is that some Asian countries are more enabled to act on their boy preference than others.It appears we should now be including some European countries in that “enabled” group as well.
* Neither the United Nations, Population Reference Bureau, nor the World Bank have published 2013 statistics yet for comparison to the CIA data.
Jennifer Lundquist is an associate professor of sociology at the University of Massachusetts, Amherst who specializes in stratification and social demography. Eiko Strader is a PhD student in sociology at the University of Massachusetts, Amherst who studies inequality in labor markets and the welfare state.
Paraphrasing Donald Rumsfeld, there are things we know and things we don’t know, and things we know we don’t know, and things we don’t know we don’t know.
One thing many working people in American don’t know that they don’t know is how poor our social benefits are compare with those enjoyed by workers in other countries. No doubt one reason is the general media blackout about worker experiences in other countries. A case in point: vacation benefits.
The Center for Economic and Policy Research recently completed a study of vacation benefits in advanced capitalist economies. Here is what the authors found:
The United States is the only advanced economy in the world that does not guarantee its workers paid vacation. European countries establish legal rights to at least 20 days of paid vacation per year, with legal requirements of 25 and even 30 or more days in some countries. Australia and New Zealand both require employers to grant at least 20 vacation days per year; Canada and Japan mandate at least 10 paid days off. The gap between paid time off in the United States and the rest of the world is even larger if we include legally mandated paid holidays, where the United States offers none, but most of the rest of the world’s rich countries offer at least six paid holidays per year.
Even though paid vacations and holidays are not legally required in the United States, some employers do provide them to their workers. The table below shows the paid vacations and paid holidays offered in the U.S. private sector based on data from the 2012 National Compensation Survey. The first two columns show the percentage of private sector workers that receive paid leave, vacation and holidays. The next two columns show the average number of paid vacation and paid holidays provided to those employees that receive the relevant benefit. The last two columns show the average number of paid vacation and paid holidays for all private sector workers, meaning those that receive and those that do not receive the relevant benefits.
Thus, on average, private-sector workers in the United States receive ten days of paid vacation per year and six paid holidays. This total still leaves U.S. workers last in the rankings even when compared with the legal minimums highlighted above. And many employers in these other countries also offer more paid leave than legally required.
Moreover, several countries require additional paid leave for younger and older workers, additions that are also not included in the legal minimums highlighted above. For example, “in Switzerland, workers under the age of 30 who do volunteer work with young people are entitled to an additional five days of annual leave. Norway offers an additional week of vacation to workers over the age of 60.”
And some countries provide additional leave for workers with difficult schedules. For example, “Australia offers some shift workers an additional work week of leave. Austria offers workers with ‘heavy night work’ two to three extra days of leave, depending on how frequently they do this shift work, and an additional four days of leave after five years of shift work.”
Several countries offer additional paid leave for jury service, moving, getting married, or community or union work. For example, “French law guarantees unpaid leave for community work, including nine work days for representing an association and six months for projects of ‘international solidarity’ abroad and leave with partial salary for ‘individual training’ that is less than one year. Sweden requires employers to provide paid leave for workers fulfilling union duties.”
Austria, Belgium, Denmark, Greece, and Sweden even require employers to pay workers at a premium rate while they are on vacation.
There is more to say, but the point should be clear. Ignorance of experiences elsewhere has narrowed our own sense of possibilities.
Wealth data is not easy to get. Still for three years now, Credit Suisse Research Institute has published an annual Global Wealth Databook which attempts to estimate global wealth holdings. The most recent issue includes data covering 2012. According to Credit Suisse, the goal “is to provide the best available estimates of the wealth holdings of households around the world for the period since the year 2000.”
According to the publication, global household wealth was $222.7 trillion in mid-2012, equal to $48,500 for each of the 4.6 billion adults in the world. Wealth is defined as “the marketable value of financial assets plus non-financial assets (principally housing and land) less debts.”
Not surprisingly, as the figure below shows, average global wealth varies considerably across countries and regions.
Also significant are the values of the mean vs the median wealth in each of the countries. Mean or average wealth is calculated by dividing the total wealth of a country by its adult population. Median wealth is the wealth holdings of the adult in the middle of the wealth distribution. The median is generally considered a far more reliable indicator of wealth because it is less sensitive to extremes at the top or bottom of the distribution. The greater the divergence of mean and median wealth, the greater is the wealth inequality.
The table below provides mean and median wealth estimates for those countries with generally reliable data. As you can see, the U.S. ranks high in terms of mean wealth, trailing only 5 countries. Things are quite different when it comes to median wealth; the U.S. trails 26 countries! Not surprisingly, then, the U.S. is No. 1 when it comes to the mean/median wealth ratio, or wealth inequality.
We clearly dominate in the number of millionaires and the upper global wealth categories. Are we a wealthy country? Definitely. Is that wealth concentrated in relatively few hands? Definitely.
According to an op-ed in the Times, America is the global leader in broadband, with high speeds and great service. And it’s all because the government restrained “onerous” regulation and let companies like Verizon do what they want and charge what they want.
It was written by the CEO of Verizon, Lowell McAdam.
I pay Mr. McAdam’s company about $115 each month for my land line, wi-fi, and cable (all FIOS). Mr. McAdam compares the U.S. favorably with Europe, “where innovation and investment in advanced networks have stagnated under an onerous regulatory regime.” I asked a friend who lives in Paris what he pays for his FIOS phone, wi-fi, and cable. The monthly bill: 39.90€ ($52) or half of what I pay Verizon. Maybe there’s an upside to stagnant and onerous.
There’s nothing wrong with getting what you can afford, and it occurred to me that U.S. broadband is the best because we can afford more. Onerous regulations or no, most other countries are not as rich as the U.S. What if you looked at broadband and per capita GDP?
The OECD did just that with data from June 2012 (their several spreadsheets on this are here). The purple bars are broadband penetration and the bumpy red line is GDP per capita. Do you see a correlation?
Consider France: As of a year ago, the country had greater broadband penetration despite a lower per capita GDP than the U.S. ($35,133 vs. $46,588); that’s 25% more broadband on 33% less income and at half the cost to consumers.
If you re-rank the OECD countries factoring in per capita GDP, the line-up changes. Notably, the U.S. and Luxembourg drop well below the OECD average, despite being among the wealthiest countries.
Of course, not all broadbands are equally broad. Verizon sold me on fiber-optic with their assurance that it was dazzlingly faster than their DSL that I had been clunking along on. This graph breaks down broadband into its various incarnations.
The U.S. is slightly above average on all broadband, but when it comes to a high fibre diet, we are ahead of several other countries that have greater total penetration. On the other hand, the Scandinavian countries are ahead of us, as are, impressively, the Asian countries.
This is not to deny U.S. advances. TechCrunch summarizes more recent data from Akamai on these changes:
the U.S. is currently second in the price of broadband for entry-level users. The nation is also third in network-based competition, second in the fiber-optic installation rate, first in the adoption of next-generation LTE, ahead of Europe in broadband adoption, and doing quite well in Internet-based services.
Still, the U.S. lags behind other, less wealthy countries. InnovationFiles, using Akamai data for different variables, has a less congratulatory view.
The U. S. has picked up one place in the “Average Peak Connection Speed” that’s the best measurement of network capacity, rising from 14th to 13th as the measured peak connection speed increased from 29.6 Mbps to 31.5 Mbps.
In terms of the “Average Connection Speed,” widely cited by analysts who don’t know what it means, the U. S. remains in 8th place world-wide. but we’re no longer tied for it as we were in the previous quarter; Sweden is right behind us on this one.
In terms of “High Speed Broadband Adoption”, the proportion of IP addresses with an Average Connection Speed greater than 10 Mbps, we remain in 7th place, but now we’re tied with Sweden.
The title of CEO McAdam’s op-ed is “How the US Got Broadband Right.” Given the content, I guess “We’re Number 13!” wouldn’t have been appropriate. Even “We’re Number Seven (Tied With Socialist Sweden)!” doesn’t quite have that affirmative zing.
The phrase “social construction” refers to the fact that things, symbols, places, sounds — basically everything — is devoid of meaning until we, collectively, agree as to what something means. Once that happens, it has been “socially constructed” and we can refer to it as a “social construct.”
The fact that gestures have any meaning at all, and that they can have different meanings in different places, is a simple example of this basic sociological concept. Enjoy this one minute compilation of examples!
Forty years ago Richard Easterlin proposed the paradox that people in wealthier countries were no happier than those in less wealthy countries. Subsequent research on money and happiness brought modifications and variations, notably that within a single country, while for the poor, more money meant fewer problems, for the wealthier people — those with enough or a bit more — enough is enough. Increasing your income from $100,000 to $200,000 isn’t going to make you happier.
It was nice to hear researchers singing the same lyrics we’ll soon be hearing in commencement speeches and that you hear in Sunday sermons and pop songs (“the best things in life are free”; “mo’ money mo’ problems”). But this moral has a sour-grapes taste; it’s a comforting fable we non-wealthy tell ourselves all the while suspecting that it probably isn’t true.
A recent Brookings paper by Betsey Stevenson and Justin Wolfers adds to that suspicion. Looking at comparisons among countries and within countries, they find that when it comes to happiness, you can never be too rich.
Stevenson and Wolfers also find no “satiation point,” some amount where happiness levels off despite increases in income. They provide US data from a 2007 Gallup survey:
The data are pretty convincing. Even as you go from rich to very rich, the proportion of “very satisfied” keeps increasing. (Sample size in the stratosphere might be a problem: only 8 individuals reported annual incomes over $500,000;100% of them, though, were “very happy.”)
Did Biggie and Alexis get it wrong?
Around the time that the Stevenson-Wolfers study was getting attention in the world beyond Brookings, I was having lunch with a friend who sometimes chats with higher ups at places like hedge funds and Goldman Sachs. He hears wheeler dealers complaining about their bonuses. “I only got ten bucks.” Stevenson and Wolfers would predict that this guy’s happiness would be off the charts given the extra $10 million. But he does not sound like a happy master of the universe.
I think that the difference is more than just the clash of anecdotal and systematic evidence. It’s about defining and measuring happiness. The Stevenson-Wolfers paper uses measures of “life satisfaction.” Some surveys ask people to place themselves on a ladder according to “how you feel about your life.” Others ask
All things considered, how satisfied are you with your life as a whole these days?
The GSS uses happy instead of satisfied, but the effect is the same:
Taken all together, how would you say things are these days – would you say that you are very happy, pretty happy, or not too happy?
When people hear these questions, they may think about their lives in a broader context and compare themselves to a wider segment of humanity. I imagine that Goldman trader griping about his “ten bucks” was probably thinking of the guy down the hall who got twelve. But when the survey researcher asks him where he is on that ladder, he may take a more global view and recognize that he has little cause for complaint. Yet moment to moment during the day, he may look anything but happy. There’s a difference between “affect” (the preponderance of momentary emotions) and overall life satisfaction.
Measuring affect is much more difficult — one method requires that people log in several times a day to report how they’re feeling at that moment — but the correlation with income is weaker.
In any case, it’s nice to know that the rich are benefitting from getting richer. We can stop worrying about their being sad even in their wealthy pleasure and turn our attention elsewhere. We got 99 problems, but the rich ain’t one.