Comparisons across cities are notoriously hard. For one, data availability is a huge problem given our methodological bias on the nation state. But there is also the problem on how we delineate municipalities. Nonetheless, I found this graph on city size and inequality very interesting.
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The graph comes from a Euromonitor blog post from 2013. It makes the point that city size and income inequality are positively correlated. The bigger the city, the more unequal is the distribution of income.
Tokyo is an outlier, by far the biggest city on earth but also one of the relatively more equal cities with a Gini of less than 0.4. The post doesn’t say where the data is taken from, so we can only wonder which cities made it into the sample and which didn’t, and how that affected the result.
Unfortunately, there seems to be no easy way to test this hypothesis. UN Habitat has some data available on income inequality in some cities as part of their urban database. Frankly, though, it is not very user-friendly, and does not have population size for all cities that have an income Gini.
I’ll keep looking for data to calculate something along the lines of the above. But for now, it is perhaps worth understanding why Kasparas Adomaitis, the author of the Euromonitor blog post, thinks large cities are prone to being more unequal:
Thanks to the large jobs market, megacities often lure the unqualified population from the country‘s hinterlands (or from abroad, in the case of the most developed countries). For the skilled and talented, big cities magnify their returns to scale. The result is enormous disparities in income.
The rest of the blog post is a fairly anecdotal piece on aspects of urban inequality in New York, London, China and Brazil, without making much more in the way of theoretical contributions. I wish the author had expanded on some of his thinking.