4 ms·

Number 1 for disposable income sounds off. Are daycare, tuitions, healthcare, public transport, rent/mortgages etc. factored in?

by dgb23 4y ago

throwaway6734 4y ago
https://en.wikipedia.org/wiki/Disposable_household_and_per_capita_income https://en.wikipedia.org/wiki/Disposable_household_and_per_c... not sure how accurate wikipedia is here, but I've seen this claim elsewhere
- dgb23 4y ago
  So there is a difference between disposable and discretionary income: https://en.wikipedia.org/wiki/Disposable_and_discretionary_income https://en.wikipedia.org/wiki/Disposable_and_discretionary_i... Apparently what I meant above is discretionary income, which would include all fundamental bills/payments such as healthcare etc. Disposable income does not include those, it only includes income plus direct payments from the government. What would interest me is discretionary income, which includes healthcare, mortgages etc. plus education, public transport, daycare, energy and I'm possibly forgetting some fundamental things. "Disposable" is very much misleading here. If you have 1000$ "disposable" income but you still have to pay for or cannot afford all of the mentioned things then you are in worse shape than someone who has 500$ "disposable" income but can lean on public infrastructure and subsidies for those things. The difference can be quite massive. The reason I'm specifically suspicious of the US here is that public infrastructure seems to be quite a bit behind and fundamental things like healthcare is substantially more expensive than in some of the most developed countries.
  - quantumwannabe 4y ago
    The numbers on the GP's page include the value of government benefits. If you exclude the European social benefits, their median disposable income is even lower. >The following table represents data from OECD's "median disposable income per person" metric, which includes all forms of income as well as taxes and transfers in kind from governments for benefits such as healthcare and education and is equivalised by dividing by the square root of household size. This metric, in addition to using a median rather than a mean, uses "data calculated according to the new OECD terms of reference"; compared to previous terms of reference, these "include a more detailed breakdown of current transfers received and paid by households as well as a revised definition of household income, including the value of goods produced for own consumption as an element of self-employed income." As OECD displays median disposable incomes in each country's respective currency, the values were converted here using the World Bank's PPP conversion factors, accounting for each country's cost of living in the year that the disposable median income was recorded. Unless noted otherwise, all data refers to 2019. Data are in United States dollars at current prices and current purchasing power parity for private consumption for the reference year.
coliveira 4y ago
All these statistics suffer from the inequality in the US. I guess that if you take total disposable income the number 1 is correct. But if you go look at the reality, it is a minority that controls that total disposable income, while most of the population lives paycheck to paycheck and increasingly don't have money even to buy food.
- ChrisLomont 4y ago
  That's why I cited median values - so your complaint does not apply, since by mathematical fact a tiny minority cannot change the median appreciably.
  - coliveira 4y ago
    People don't seem to understand that median is not a measure that is much better than mean, especially in the case of high inequality. For example, if I take all the money from the 40% poorer population and distribute it to the 40% richer population, the median is still the same. If you don't believe, just compute the mean and median of these two sequences: [1,2,3,4,5,6,7,8,9,10] [0,0,0,0,5,6,11,11,11,11] Another example that I know fully well is Brazil: the mean is 8,560 BRL and the median is 8,220 BRL for monthly salaries, that is, very close. But these monthly salaries are known to vary widely from 2,170 BRL (USD 417) to 38,200 BRL (USD 7349), so hardly anyone is really making 8220 or close to that.
    - ChrisLomont 4y ago
      >People don't seem to understand that median is not a measure that is much better than mean, especially in the case of high inequality. Yes, they do. I am a PhD mathematician with decades of work using these tools. I am quite clear on the meanings and shortcoming of all sorts of indicators. I am also aware how real world data trends instead of cooked up examples that don't match reality. Median is a common value used by economists precisely because it more likely shows what a person makes as opposed to the mean, especially in cases of high inequality. > If you don't believe Yes, you can make up all sorts of nonsense. Not a single country follows the distributions you made up. >Another example that I know fully well is Brazil: You conclusion does not at all follow from your claim. Or from the actual data. > so hardly anyone is really making [the median] or close to that Well, by definition, over half of people make the median or more. Is that hardly anyone? If you look at the data [1] (income by decile in Brazil), besides the 50% making median income or higher, another 30% of the people make within 30% of median. That leaves 20% of the people making under 70% of the median income. What is your definition of "hardly anyone"? Look at the data. Clearly median is much more accurate than mean for explaining how much people make, as this example showed. [1] https://www.statista.com/statistics/1251075/average-monthly-income-percentile-brazil/ https://www.statista.com/statistics/1251075/average-monthly-...

Number 1 for disposable income sounds off. Are daycare, tuitions, healthcare, public transport, rent/mortgages etc. factored in?

by dgb23 4y ago

Number 1 for disposable income sounds off. Are daycare, tuitions, healthcare, public transport, rent/mortgages etc. factored in?

throwaway6734 4y ago

https://en.wikipedia.org/wiki/Disposable_household_and_per_capita_income https://en.wikipedia.org/wiki/Disposable_household_and_per_c... not sure how accurate wikipedia is here, but I've seen this claim elsewhere

dgb23 4y ago
So there is a difference between disposable and discretionary income: https://en.wikipedia.org/wiki/Disposable_and_discretionary_income https://en.wikipedia.org/wiki/Disposable_and_discretionary_i... Apparently what I meant above is discretionary income, which would include all fundamental bills/payments such as healthcare etc. Disposable income does not include those, it only includes income plus direct payments from the government. What would interest me is discretionary income, which includes healthcare, mortgages etc. plus education, public transport, daycare, energy and I'm possibly forgetting some fundamental things. "Disposable" is very much misleading here. If you have 1000$ "disposable" income but you still have to pay for or cannot afford all of the mentioned things then you are in worse shape than someone who has 500$ "disposable" income but can lean on public infrastructure and subsidies for those things. The difference can be quite massive. The reason I'm specifically suspicious of the US here is that public infrastructure seems to be quite a bit behind and fundamental things like healthcare is substantially more expensive than in some of the most developed countries.
- quantumwannabe 4y ago
  The numbers on the GP's page include the value of government benefits. If you exclude the European social benefits, their median disposable income is even lower. >The following table represents data from OECD's "median disposable income per person" metric, which includes all forms of income as well as taxes and transfers in kind from governments for benefits such as healthcare and education and is equivalised by dividing by the square root of household size. This metric, in addition to using a median rather than a mean, uses "data calculated according to the new OECD terms of reference"; compared to previous terms of reference, these "include a more detailed breakdown of current transfers received and paid by households as well as a revised definition of household income, including the value of goods produced for own consumption as an element of self-employed income." As OECD displays median disposable incomes in each country's respective currency, the values were converted here using the World Bank's PPP conversion factors, accounting for each country's cost of living in the year that the disposable median income was recorded. Unless noted otherwise, all data refers to 2019. Data are in United States dollars at current prices and current purchasing power parity for private consumption for the reference year.

coliveira 4y ago

All these statistics suffer from the inequality in the US. I guess that if you take total disposable income the number 1 is correct. But if you go look at the reality, it is a minority that controls that total disposable income, while most of the population lives paycheck to paycheck and increasingly don't have money even to buy food.

ChrisLomont 4y ago
That's why I cited median values - so your complaint does not apply, since by mathematical fact a tiny minority cannot change the median appreciably.
- coliveira 4y ago
  People don't seem to understand that median is not a measure that is much better than mean, especially in the case of high inequality. For example, if I take all the money from the 40% poorer population and distribute it to the 40% richer population, the median is still the same. If you don't believe, just compute the mean and median of these two sequences: [1,2,3,4,5,6,7,8,9,10] [0,0,0,0,5,6,11,11,11,11] Another example that I know fully well is Brazil: the mean is 8,560 BRL and the median is 8,220 BRL for monthly salaries, that is, very close. But these monthly salaries are known to vary widely from 2,170 BRL (USD 417) to 38,200 BRL (USD 7349), so hardly anyone is really making 8220 or close to that.
  - ChrisLomont 4y ago
    >People don't seem to understand that median is not a measure that is much better than mean, especially in the case of high inequality. Yes, they do. I am a PhD mathematician with decades of work using these tools. I am quite clear on the meanings and shortcoming of all sorts of indicators. I am also aware how real world data trends instead of cooked up examples that don't match reality. Median is a common value used by economists precisely because it more likely shows what a person makes as opposed to the mean, especially in cases of high inequality. > If you don't believe Yes, you can make up all sorts of nonsense. Not a single country follows the distributions you made up. >Another example that I know fully well is Brazil: You conclusion does not at all follow from your claim. Or from the actual data. > so hardly anyone is really making [the median] or close to that Well, by definition, over half of people make the median or more. Is that hardly anyone? If you look at the data [1] (income by decile in Brazil), besides the 50% making median income or higher, another 30% of the people make within 30% of median. That leaves 20% of the people making under 70% of the median income. What is your definition of "hardly anyone"? Look at the data. Clearly median is much more accurate than mean for explaining how much people make, as this example showed. [1] https://www.statista.com/statistics/1251075/average-monthly-income-percentile-brazil/ https://www.statista.com/statistics/1251075/average-monthly-...