New York City mayor Bill de Blasio assumed office in January 2014, promising to “take dead aim at the Tale of Two Cities . . . [and] put an end to economic and social inequalities that threaten to unravel the city we love.” As the de Blasio administration nears the end of its four-year term, income inequality in 2016, the most recent year for which data are available, stood at the same level it was when former mayor Michael Bloomberg left office. During the interim, income inequality has fluctuated—at one point becoming even greater than it was when de Blasio entered office—and only more recently reverted to the Bloomberg-era level.
- According to the most recent available data, household income inequality, as measured by the Gini coefficient—a means of gauging the relative shares of income across a population—is unchanged since the end of the Bloomberg administration in December 2013.
- The Theil Index, another way to measure income inequality, shows that changes in the extent of income inequality in New York are largely explained not by public-policy interventions but by the compensation trends of one industry: finance.
- A transitory increase in compensation for finance professionals (as a group, the city’s highest paid) led the gap between New York’s rich and poor to increase in 2014 and 2015. In 2016, a modest decline in compensation in that sector reduced income inequality to the same level as when Mayor de Blasio took office.
- These findings raise questions as to whether public policies within city government’s control that might reduce income inequality—notably, by having fewer wealthy residents (from, say, imposing higher income taxes) and fewer poor residents (by, for instance, building fewer affordable housing units)—would improve the well-being of low-income New Yorkers.