REAL index

I don’t really want to write this but I may as well get it down so that I can refer to it if I ever need to.

Ever heard of the GINI index? It’s a measure of statistical dispersion intended to represent the income distribution of a nation’s residents, and is the most commonly used measure of inequality.

It’s not very accurate or precise but it gives the impression of quantifying the subject matter, and it’s main purpose is to stop those morons that insist on references to academic papers from derailing any debate on the subject.

In this very context I have in my head a new index which I will call the REAL index.

It’s a measure of the ‘realness’ or ‘usefulness’ of a person’s employment.

At one end we would have a 0, where employment is totally artificial and at the other end, 1, where employment is very much directly related to basic human needs.

I haven’t come up with any specific maths but this index would be impacted by things such as:

1. Does your employment exist only because of some government legislation?
2. Does your organization provide unique product and services?
3. Are your job skills unique, or are you readily replaceable?
4. Is your employment or organization in any way associated with basic human needs?
5. Yada….

I would say that before the industrial revolution that most people had a REAL index close to unity.

Today my guess is that it’s totally the reverse and that most people have a REAL index closer to 0.

What has happened is that increased productivity has meant fewer and fewer people are needed in employment related to basic human needs; probably well less than 1% in the West today.

This could have gone two ways; you might expect that all those people that weren’t required for critical employment would have been left to rot and we could have ended up with an incredibly two tiered society.

But, fortunately I guess, we needed all the people to have money so they could consume the outcomes of all that increased productivity in goods and services that we don’t really need.

And thus we all went up the REAL index as layers and layers of complex and quite artificial jobs were created around layers and layers of non-critical goods and services.