Mean Republicans and Median Democrats

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The latest column of John Allen Paulos’, “Who’s Counting:It's Mean to Ignore the Median”;

“Believe it or not, the difference in the way the Democrats and Republicans react to the performance of the U.S. economy is clarified by a mathematical distinction studied in elementary school. The distinction is between the mean, which the Republicans emphasize, while the Democrats prefer the median. Before turning to the economy, let me review a little fourth-grade arithmetic….

The relevance of this distinction is apparent in the just-released figures on the U.S. economy for 2004, the latest year for which there is complete data. The Republicans chortle that the economy grew at a healthy rate of 4.2 percent. (It's slowed since then.) The Democrats point to data from the Census Bureau for the same year (and earlier as well), indicating that the real median family income fell and that poverty increased…

Still, this lopsidedness is neither necessary nor inevitable, and it bodes ill for civil society. Almost 2,400 years ago Aristotle, seeing the discord between ancient Greece's rich and poor, applied his idea of the golden mean to call for an equitable (but not equal) income distribution. For purposes of stability, he favored establishing a strong middle class and government policies to assist in this establishment.

A little game from the field of behavioral finance illustrates the class resentment Aristotle described. The so-called "ultimatum game" generally involves two players: One is given a certain amount of money, say $100, by an experimenter, and the other is given a kind of veto. The first player may offer any nonzero fraction of the $100 to the second player, who can either accept or reject it. If he accepts it, he is given whatever amount the first player has offered, and the first player keeps the balance. If he rejects it, the experimenter takes the money back…”

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This page contains a single entry by Paul published on September 5, 2006 1:01 PM.

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