If a country is at the extremes of the Gini coefficient (0 or 1, see Figure 1), this means that the incentive system of the society has been destroyed. Therefore, having a value in the middle guarantees that there will be something to look forward to. America has been resilient over its 250 years of life because it has been able to right its economy when the chips were down, and I suspect it will do so again, except if it becomes communist or totalitarian, namely having a Gini coefficient of 0 or 1.

So, how does one interpret the Gini coefficient, in light of the fact that humans since 1950 have not been living sustainably but are instead depleting resources at an alarming rate as the population approaches 10 billion (Rockström and Gaffney 2021; Sachs 2015). It has been estimated that hunter gatherer societies, which do not store wealth and which have occupied 90% of human history, have a Gini coefficient of less than 0.2 (Smith et al. 2010), and that in 2,000 BCE most of our planet was inundated by such groups (see Figure 2). In hunter gatherer societies, health and social connections are deemed more important than material assets, and child rearing and food (game and plant products) are shared but mate selection is competitive (Smith et al. 2010). Today, most hunter gatherer societies either have gone extinct or have been absorbed by resource acquisition societies.

Resource acquisition societies depend on continuous growth (see any issue of The Economist on GDP). Most current societies will not be returning to a hunter gatherer model any time soon, which means we will need to regulate humankind’s tendency of unrelenting growth, which has brought about the extinctions of many plant and animal species (Leakey 1995; Wilson 2002). Here in Florida (where I live) citizens report opening their garage doors to find an alligator occupying the space; this is because the demand for land to build housing is driving out (or in) the wildlife.

Figure 1: Lorenz Curves: The fraction of all income is plotted as a population fraction. A Gini coefficient value of 0 indicates perfect egalitarianism and a Gini coefficient value of 1 indicates perfect totalitarianism. Values for countries vary between 0.2 and 0.7. At the extreme for resource acquisition societies, the Netherlands have a value of 0.25 and South Africa has a value of 0.63.

Figure 2: Distribution of hunter gatherer societies in the world in 2,000 BCE (in yellow).