We need more downward mobility

June 16, 2021

We often gauge inequality by looking at income distributions and complain about the lack of equal opportunity in society. To fight inequality, governments are in search of social measures to ease the path upwards and close the income gap. For example, better education is widely held to be the great equalizer and the best way to move up on the social ladder. Although this is presumably true, it is only half the story. Income distributions only offer a static snapshot of equality. To fully comprehend inequality, one should also look at the dynamics of the population. Equally important is the capacity of the population to constantly change positions, keep moving from time to time, including the rich and arrived (i.e. downward mobility). Mathematically, this is called the ergodicity of the system and, more intuitively, this tells us whether the rich stay rich and lock in their privileges and wealth or if one has a good chance to become rich(er), but still end up poor(er). From this point of view, Europe may be more unequal than the U.S., because, according to Nassim Taleb, Europe excels in non-ergodic systems. So, often neglected, the path to equal societies is not only to empower the lower classes, but just as much to add some skin in the game for the richest decile of the income distribution, to increase the chances some of them actually slide down the social ladder.

Burning questions:
  • Is the current surge in “public executions” based on someone’s private behavior a symptom of our non-ergodic system and lack of downward mobility by other means?
  • How do we make our central and bureaucratic organizations, companies and governments have more skin in the game?
  • Can the decentralized architecture of Web3 increase the ergodicity of the system in the future, or will it establish new, unforeseen mechanisms and patterns of absorbing wealth and sticky wealth in a decentralized economy?

Series 'AI Metaphors'

1. The Tool
Category: Objects
Humans shape tools.

We make them part of our body while we melt their essence with our intentions. They require some finesse to use but they never fool us or trick us. Humans use tools, tools never use humans.

We are the masters determining their course, integrating them gracefully into the minutiae of our everyday lives. Immovable and unyielding, they remain reliant on our guidance, devoid of desire and intent, they remain exactly where we leave them, their functionality unchanging over time.

We retain the ultimate authority, able to discard them at will or, in today's context, simply power them down. Though they may occasionally foster irritation, largely they stand steadfast, loyal allies in our daily toils.

Thus we place our faith in tools, acknowledging that they are mere reflections of our own capabilities. In them, there is no entity to venerate or fault but ourselves, for they are but inert extensions of our own being, inanimate and steadfast, awaiting our command.
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2. The Machine
Category: Objects
Unlike a mere tool, the machine does not need the guidance of our hand, operating autonomously through its intricate network of gears and wheels. It achieves feats of motion that surpass the wildest human imaginations, harboring a power reminiscent of a cavalry of horses. Though it demands maintenance to replace broken parts and fix malfunctions, it mostly acts independently, allowing us to retreat and become mere observers to its diligent performance. We interact with it through buttons and handles, guiding its operations with minor adjustments and feedback as it works tirelessly. Embodying relentless purpose, laboring in a cycle of infinite repetition, the machine is a testament to human ingenuity manifested in metal and motion.
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About the author(s)

Economist and philosopher Sebastiaan Crul writes articles on a wide range of topics, including rule of law in digital societies, the virtualization of the lifeworld and internet culture. He is currently working on his doctoral degree on the influence of digitalization on mental health and virtue ethics, having previously published dissertations on the philosophy of play and systemic risks in the finance industry.

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