Explaining Distributional Differences
An economic historian observes that a graphical representation of wealth distribution for a typical 18th-century naval vessel shows a curve bowed significantly away from the 45-degree line of perfect equality. In contrast, the curve for a typical pirate ship from the same era lies much closer to this line. Based on the principles of wealth distribution, explain the underlying institutional reasons for this observed difference in the two curves.
0
1
Tags
Economics
Economy
Introduction to Macroeconomics Course
Ch.2 Unemployment, wages, and inequality: Supply-side policies and institutions - The Economy 2.0 Macroeconomics @ CORE Econ
The Economy 2.0 Macroeconomics @ CORE Econ
CORE Econ
Social Science
Empirical Science
Science
Analysis in Bloom's Taxonomy
Cognitive Psychology
Psychology
Related
Figure 2.3: Lorenz Curves for Spoils Distribution on Pirate and Naval Ships
Relationship Between the Lorenz Curve Area and the Gini Coefficient
Unequal Spoils Distribution on the Royal Navy's 'Favourite' and 'Active'
Lorenz Curve for Spoils Distribution on the Royal Rover
Evaluating Wealth Distribution in Maritime Crews
Consider two eighteenth-century maritime crews with different systems for distributing captured treasure. Crew A operates under a strict hierarchy where officers receive disproportionately large shares, leaving a small fraction for the common sailors. Crew B follows a set of articles ensuring a much more even distribution, where each member's share is clearly defined and the difference between the highest and lowest shares is relatively small. If you were to plot a graphical representation of each crew's wealth distribution, with the cumulative percentage of the crew on one axis and the cumulative percentage of treasure they receive on the other, what would you expect to observe?
Explaining Distributional Differences
Match each description of a system for distributing spoils among a ship's crew to the corresponding characteristic of its graphical representation of inequality, where the axes plot the cumulative percentage of the crew against the cumulative percentage of spoils they receive.
Comparative Fairness of Pirate vs. Naval Systems in the 18th Century