Wealth and tolerance

Richer people are more civilized than poor ones. This thought struck me during last night's Steaua Bucharest-Arsenal game.
Arsenal's black players were loudly booed - a fact only the Mirror saw fit to report.   This is not something that happens in England, or even much in north west Europe. But it is common in the poorer parts of Europe, or in poorer parts of richer countries - at Lazio but not Milan, for example.
Which raises the possibility - that economic growth helps reduce racism. Benjamin Friedman shows in this book that the Ku Klux Klan gained strength during recessions and declined during periods of growth. And this paper shows a correlation between individual prosperity and liberalism.
But what's the mechanism?
One possibility is that the rich are more relaxed than the poor, so don't feel threatened by people who look different from them.
I'm not sure. A combination of habit formation and loss aversion mean the rich are just as keen as the poor to protect what they have.
Another possibility is that immigrants compete with the poor for unskilled work  and so drive down wages for the poor but not the rich.
I'm not sure this true. And even if it is, it can't explain Steaua fans' racism. Bucharest is not a poor city because an influx of Togolese has driven down wages.
Instead, I suspect one mechanism is that the rich know better than the poor that diversity is a source of wealth. Differences in tastes and abilities are what lie behind the division of labour, comparative advantage and hence prosperity. As the cliche goes, it takes differences of opinion to make a market. Instinctively, therefore, we rich people regard people of different ethnicities as providing opportunities to get rich, not threats to our status. We know better than the poor - and certainly better than those brought up under Communism - that the economy is a positive-sum game.
This mechanism predicts that those who got rich from trading will be more tolerant, on average, than those who got rich in other ways - through inheritance, say.  How much evidence is there for this? Here's one datapoint.
What's more, this suggests there might be another growth trap. Poverty causes intolerance. But intolerance also retards growth.

Comments

[Matt Munro]

That assumes that racism is an entirely social/rational construct whereas it's actually associated with innate instinct, as measured by neural activity in a part of the brain involved with threat recognition, and which isn't limited to particular social groups.
It's more likely that rich/educated people supress any racist instincts in order to expoloit (or patronise) the "out group", while the poor/uneducated express it overtly as a pre-cursor to direct acts of agression.
What I find bizzare about racism in football crowds is that it never seems to occur to the abuser that the black players on his own team will be equally offended and thus demotivated by it.

[Marcin Tustin]

I suspect that the mechanism is that the poor are for psychological reasons driven to blame outsiders for their problems, and may derive a lot of psychological satisfaction from involvement in hate as a substitute for the goods of achievement and status. The rich will already have alternatives to this, and will also be subject to the processes that Chris has described.

[Mike]

[1] ‘Instead, I suspect one mechanism is that the rich know better than the poor that diversity is a source of wealth.’

Where’s your evidence? You’re pulling clichés out of the sky. Racism is here to stay, whether you like it or not. Keeping the pedal to the metal on the immigration throttle will only make matters worse.

And no: you can’t engineer racism out of existence. Yes, you can contain it. But no, you can’t eliminate it. A person's most visceral loyalties are not to words or ‘economic propositions,’ but to the other people, living and dead, in the group to which he belongs.

Ask yourself this: Why do social creatures, whether ants or humans, tend to be nepotistic? Why do we sacrifice for our children and even for our more distant relatives?

Answer: kin selection. The more genes we share with another individual, the more altruistic we are toward him or her. And the less kind we are toward our more distant kin. (For a Marxist perspective, I recommend ‘The Ethnic Phenomenon’ by Pierre L. van den Berghe.)

[2] ‘Poverty causes intolerance. But intolerance also retards growth.’

True, but continuous immigration retards the growth of interracial marriage:

http://www.vdare.com/sailer/la.htm

[3] ‘Another possibility is that immigrants compete with the poor for unskilled work and so drive down wages for the poor but not the rich.’

Correct. George Borjas has proven, beyond all doubt, that a continuous stream of low-skilled migrants (who are willing to work below the market clearing-level) depreciates wages.

[Scratch]

"Richer people are more civilized than poor ones."

You've never spent time in a golf club bar have you?

[Mike]

Economists’ faith in economic solutions to solve all of humanity’s problems was wonderfully lampooned by John Derbyshire in an essay for National Review Online called 'Islamophobophobia'

He posited the ‘diversity theorem’:

The Diversity Theorem: Groups of people from anywhere in the world, mixed together in any numbers and proportions whatsoever, will eventually settle down as a harmonious society, appreciating — nay, celebrating! — their differences... which will of course soon disappear entirely.

Sounds familiar, dunnit?

[Alex]

Name one thing John Derbyshire or NRO has been proved right on - as Dan Davies would say, past performance is a guide to future performance when you're talking about individuals.

[Matt Munro]

Marcin: Indeed, that is the psychological purpose of the out group - to act as a repository for the projected negativite emotions of the in group.
I'm still not convinced that increased wealth equates to increased tolerance though. The richest part of Bristol is almost 100% white, and I'm sure that's true of most cities in Uk and Europe. The first thing most white people who "make it" do is move to the (white) suburbs or countryside.
The (lower)working class on the other hand have to live in poorer neighbourhoods and encounter immigrants far more frequently than their rich counterparts, who only see migrants through the window of the Rolls or as providers of menial labour, they already have assured power over them and don't need to assert it verbally or physically.

[ad]

"Instead, I suspect one mechanism is that the rich know better than the poor that diversity is a source of wealth. Differences in tastes and abilities are what lie behind the division of labour, comparative advantage and hence prosperity."

This would seem to be true only if we really are different under the skin. If not, I could argue that the poor know better than the rich that diversity is a source of arguments and civil war...

It is not obvious that Japan has suffered from its lack of diversity, and it is obvious that Lebanon has suffered from its diversity.

I think it perfectly natural to move from a poorer place to a richer one, but I don't think it was unreasonable for eg Palestinians to worry about Jewish immigration, economically beneficial though that migration may have been to Palestine.

It is not the economics that worries people, but the politics.

[Bob B]

"Richer people are more civilized than poor ones."

Are you sure? Can you explain this then?

"A UNITED Nations report has labelled Scotland the most violent country in the developed world, with people three times more likely to be assaulted than in America. England and Wales recorded the second highest number of violent assaults while Northern Ireland recorded the fewest."
http://www.timesonline.co.uk/article/0,,2-1786945,00.html
http://news.bbc.co.uk/1/hi/scotland/4257966.stm

"In Scotland, the alcohol-related death rates for males and females were around double the rates for the UK as a whole in 2002-2004, according to new analysis published today by the Office for National Statistics in Health Statistics Quarterly 33 (Spring 2007)."
http://www.statistics.gov.uk/pdfdir/alrate0207.pdf

[Mopsa]

Simplistic theory perhaps but I suspect that when things are bad, folks look around for someone 'other' and visibly different to blame. A vile human trait.

[Tom]

"Richer people are more civilized than poor ones."

I call upon the Bullingdon Club to refute your argument.

Isn't racism *more* prevalent in areas with a small or zero ethnic minority population than areas with a large, mixed population, though? The initial shock of seeing non-white faces produces a larger effect than seeing people from a variety of backgrounds day-in day-out.

In the case of Bucharest, the arrival of the Arsenal would produce such a shock. There's also the sheep-like nature of football crowds - you boo black players because that's what you *do* - that seems to be widespread from Spain to Serbia. Used to happen here of course, until every good team and the national side had good black players, when it became nonsensical to boo.

Given that lots of Africans play in East European sides these days, this mechanism should operate there eventually, particularly if a star striker emerges. I'm not convinced it's due to relative poverty, but I'm inclined to accept that racism emerges in times of economic decline.

[Dave]

Poor Romanians may not compete with poor Africans in Bucharest, but they do compete with them in Central and Western Europe

[Kris-Stella]

I wrote a small reply on my blog; the main bit of the text was this:

I think that it would be useful to distinguish between different levels of aggregation here. There may be different mechanisms for the relationship between wealth and intolerance in poor and wealthy individuals, poor and wealthy neighbourhoods, and poor and wealthy countries. In each case, intolerance tends to be higher in the poorer cases, but not necessarily for the same reasons.

The explanation given above, about appreciating diversity for market-based reasons, applies to relatively wealthy individuals but makes little sense for comparing countries - petit bourgeois and a low-skilled working class exist in both poor and rich countries. Since this argument is essentially about one's relationship to market forces, I don't see an obvious reason why it would apply to a low-skilled person, whether they live in a poor or wealthy country.

Dillow doubts the validity of the explanation that migrant workers (are perceived to) compete for low skilled jobs and drive down wages, partly because this hypothesis fails to explain why Romania, with few migrant workers, would exhibit high levels of intolerance. But as an explanation for regional differences within a country, this may be a justifiable hypothesis. In areas with more low-skilled workers, the perceived threat of migrant workers is more likely to result in intolerance than in wealthier areas (where an influx of cheap labour would not be perceived as a threat to the same extent).

Finally, on the national level, I think there is an explanation that is not mentioned in Dillow's post. Wealthier countries are attractive targets for migrants, whereas poorer countries are not. It is not a coincidence that Bucharest has not been flooded with Togolese migrant workers - if you are going to migrate to Europe, you might as well pick somewhere with a higher living standard, such as the UK. As a result, people in the UK will, on average, have met many more people of a different ethnic background than people in Romania. Xenophobia being fear of the unfamiliar, it is unsurprising that it is more widespread among those who have had almost no contact with people of another culture or skin colour. A wealthy country might therefore attract more migrants because of its economic credentials, and only subsequently become less xenophobic, rather than being less xenophobic simply by virtue of being wealthier.

http://kstrump.blogspot.com/2007/10/wealth-and-tolerance.html

[Kevin Carson]

The tolerant rich may be promoting racism among the poor as part of a cynical divide and rule strategy. For example Bacon's Rebellion in Virginia, which saw close cooperation between black and white members of the servant class, was followed by the introduction of the first formal slave code and attempts to promote racism and a sense of "white skin privilege" among the white lower classes.

In the South during the Depression, the tenant farmers' unions were making great headway until the landed interests exploited differences between white and black sharecroppers. In the same region after WWII, when the AFL-CIO planned a drive to organize southern textile workers and working class radicalism was on the increase, the employing classes responded with a massive increase in funding to the KKK (much like Italian industrialists responded to the factory occupations in 1920 by funding the Blackshirts).

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