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Consumer spending power of the world's population?

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AirBreather

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« on: (21:25:13/06-14-16) »
Hey all!

This is a question relating to the world population of SR and the global economy therein.

Specifically, assuming a total population of 7 billion people:
- What would be the percentage of those that have 1 nuyen (or more) per day in disposable income? (Able to spend 365 nuyen per year)
- Assuming less than 100% of the world's population have 1 nuyen (or more) per day in disposable income, would the rest of the world's population be able to balance those figures out? (Meaning: accross the total population, there is at least 7/6/5/4/3/etc billion nuyen per day in disposable income).

~AB

Wakshaani

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« Reply #1 on: (00:14:17/06-15-16) »
I've never broken the math down that way. I had a dystopian wealth imbalance mock-up assembled, but I never rolled it out. It breaks the wealth levels down into quintiles for distribution... how much money the bottom 20% have, how much the next 20% have, the true middle class, and so on.

But, it's unpublished and unofficial.

Hobbes

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« Reply #2 on: (14:57:53/06-15-16) »
Per my fuzzy memory of an IRS publication based on 2010 data.

Bottom 20% of household incomes had roughly 0.05% of total American Income.  This income is usually supplemented by state and federal aid.  These households made less than 15,000 per year.
Next 20% had around 2% of total American Income.  (yes 40% of America makes less then 3% of the total income).  Little fuzzy on this number but it was low single digits.  Again, this income is usually supplemented by some state or federal aid.  These households made less than 35,000 per year.
Next 20% had something like 13% of the total American Income.  Hilariously this group typically makes too much money to qualify for state or federal aid so their standard of living is fairly comparable to the bottom 40% despite making much more.  These households made less than 65,000 per year.
Next 20% had 25ish% of the total American Income.  These households made less than 120,000 per year.
Top 20% had around 55% of the total American Income.  And a tremendous amount of that is concentrated in the top 1%, or even top 0.01%.

This was IRS data based on Household income.  So your bottom 40% is going to be a lot of single income, college students and fixed income households as well as the working poor and underemployed.  And the numbers are from memory so I am quite willing to be a bit off, but ballpark that was the numbers.

Keep in mind America currently has the most income disparity of any developed nation.  Even more than most un-developed nations.  It's quite the historical anomaly actually.  Shadowrun would probably be not very far off  tbh, but on a global scale and often without the social safety nets. 

AirBreather

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« Reply #3 on: (16:54:30/06-15-16) »
Thanks Wakshaani & Hobbes

I'm guessing that no official stats exist? No worries.

My question came from the reference (either in War! or Ghost Cartels) that refer to a segment of the population living under 1 nuyen a day. I put on top of that how a single (cheap) 'wonder drug' would effect the world's population and economy.

Basically, assuming a population of 7 billion people, if they all spent 1 nuyen per day on average on the wonder-drug, the total (gross) income would be about 2,550,000,000,000 nuyen annually. That number BLEW MY MIND.

It could be wonder drugs, nutritional supplements, whatever - same idea.

Thoughts?

~AB

Wakshaani

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« Reply #4 on: (19:52:55/06-15-16) »
Per my fuzzy memory of an IRS publication based on 2010 data.

Bottom 20% of household incomes had roughly 0.05% of total American Income.  This income is usually supplemented by state and federal aid.  These households made less than 15,000 per year.
Next 20% had around 2% of total American Income.  (yes 40% of America makes less then 3% of the total income).  Little fuzzy on this number but it was low single digits.  Again, this income is usually supplemented by some state or federal aid.  These households made less than 35,000 per year.
Next 20% had something like 13% of the total American Income.  Hilariously this group typically makes too much money to qualify for state or federal aid so their standard of living is fairly comparable to the bottom 40% despite making much more.  These households made less than 65,000 per year.
Next 20% had 25ish% of the total American Income.  These households made less than 120,000 per year.
Top 20% had around 55% of the total American Income.  And a tremendous amount of that is concentrated in the top 1%, or even top 0.01%.

This was IRS data based on Household income.  So your bottom 40% is going to be a lot of single income, college students and fixed income households as well as the working poor and underemployed.  And the numbers are from memory so I am quite willing to be a bit off, but ballpark that was the numbers.

Keep in mind America currently has the most income disparity of any developed nation.  Even more than most un-developed nations.  It's quite the historical anomaly actually.  Shadowrun would probably be not very far off  tbh, but on a global scale and often without the social safety nets.

Man, if it was that close, it'd be less of a problem. The actual RL numbers:

Bottom 20% = 0.2%
Next 20% = 0.8%
Middle 20% = 4%
Next 20% = 10%
Top 20% = 85%

I'd planned on cranking those numbers further, but I'm not at all certain an economy is sustainable at that point.

Oh, and for the complete picture, here's the tax burden of those same groups.

Bottom 20% = 2%
Next 20% = 3%
Middle 20% = 12%
Next 20% = 20%
Top 20% = 65%

One group pays less tax than their percentage of the wealth, while the rest pay double or more. It... is some interesting research. We try to not bring outside politics into the forums, so, I'd appreciate if this didn't spin off into everybody yelling at everybody. 206's been a rough year already.

So, that's just the US. In many areas of the world, people don't bring in $1 a day, so spending at that level's unsustainable. Of course, then we get into mean vs median, the poor data collection of having everyone self-report instead of being able to use verifiable national financial information, purchasing power equity, and ... it gets complicated. Even sticking to a single nation can be complex as the living conditions in, say, Casper Wyoming, are not going to be on the same level as housing in San Francisco or New York City.

Economics ... it's a complicated field of study.

AirBreather

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« Reply #5 on: (17:20:08/06-16-16) »
*snip*

So, that's just the US. In many areas of the world, people don't bring in $1 a day, so spending at that level's unsustainable.

*snip*

Thanks Wakshaani

So... Hmm. Going totally ballpark figure, what would be a rough percentage of the population that could spend 1 nuyen a day, worldwide/averaged into the population? I looked at your figures and randomly pulled out... 40%!

As long as I don't get too much flak for that number, I'm going to work with it.

~AB

Reaver

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« Reply #6 on: (18:17:27/06-16-16) »
That quote about living on 1 nuyen a day was in Ghost cartels I believe....


And it's really not that far from the truth, thanks to the economies of scale between nations. There is a LOT of politics that goes into the pricing of various goods, which renders numbers wonky when trying to figure out why a can of Pepsi in Canada costs $1.15cdn, and a can of Pepsi costs $0.008cdn in Mexico... But trust me, there are places in the world that people survive on $9usd a YEAR, let alone a month.....


Once you get out of the 'West' and 'Europe' and get to some of the.... older places of civilization (to be politically polite), things go to Hell in a handbasket faster then a starving fat kid leaps on a M&M!! I have had the wonderful pleasure of working in the 3rd world on and off for the last 15 years, all over Africa and the Middle East, and the Islands.... I would suggest that the descriptor '3rd world' is much more accurate then just a label for their economic progress....


You want a Fast and Dirty display of wealth per nation? Look at GDP per nation, then divide that by it's population.... Gives you an idea of the individual economic wealth of a nation by population, if all other factors are equal, (which they never are). It's fast, dirty, and just a ballpark.. as GDP can be influenced by smoke and mirrors (hence why it's fallen out of favor for determining individual wealth in a society by economicists).
« Last Edit: (18:22:54/06-16-16) by Reaver »
Where am I going? And why am I in a hand basket ???

Remember: You can't fix Stupid. But you can beat on it with a 2x4 until it smartens up! Or dies.

Wakshaani

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« Reply #7 on: (23:33:35/06-16-16) »
Averages are always tricky. As the old joke says, "Three homeless guys and Bill gates sit down at  bus stop. Their average wealth is $2 billion."

Mean, median, mode... taught in grade school, forgotten by high school. :)

Hobbes

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« Reply #8 on: (10:02:21/06-17-16) »

Man, if it was that close, it'd be less of a problem. The actual RL numbers:

Bottom 20% = 0.2%
Next 20% = 0.8%
Middle 20% = 4%
Next 20% = 10%
Top 20% = 85%

I'd planned on cranking those numbers further, but I'm not at all certain an economy is sustainable at that point.

Oh, and for the complete picture, here's the tax burden of those same groups.

Bottom 20% = 2%
Next 20% = 3%
Middle 20% = 12%
Next 20% = 20%
Top 20% = 65%

One group pays less tax than their percentage of the wealth, while the rest pay double or more. It... is some interesting research. We try to not bring outside politics into the forums, so, I'd appreciate if this didn't spin off into everybody yelling at everybody. 206's been a rough year already.


Was that Capital or Income?  My fuzzy memory is from an article I read four or five years ago so, I'm sure your numbers are correct.  The Tax Burden  numbers jives with my recollection.  That was Federal, State, local, estimated sales taxes and whatever else.  It illuminates how fixed taxes (Licence Plates or toll roads for example) and things like sales and property taxes disproportionately impact lower income. 

The in-game lesson is lots of little fee's add up to keep the Wage-slaves and SINless in place.  The game hand waives this for PCs with the Lifestyle costs so we're not tracking each little nickle and dime.  But for the bigger picture your lower income masses are kept stagnant and immobile by simply charging them a Nuyen or 10 at every turn.

Your third world masses living on a Nuyen a day for example are basically locked in place because you need a Licence or Toll to go anywhere else legally.  And trusting your children to smugglers isn't normally a good idea.  And once the Labor Market is more or less locked in place the local Corp subsidiaries are free to pay as little as possible since they're the only game in town. 

As for the OPs wonder drug, pretty much needs to be a "food-pill", yes you can get a few billion Nuyen from the Masses but your margins are going to be crap because of overhead costs.  Global distribution of a physical product is pretty expensive as it turns out.  You're better off with a wonder drug or wonder food marketed to the top 20% and charge 100 Nuyen a pop.  Same ballpark gross, but a fraction of the overhead.  Plus some trickle down sales to the folks who want to be like the top 20%.  It's where the money is, and it's where a majority of the product development is likely focused in most Corps. 

Plus a Nuyen a day food pill would be crushed pretty fast by the big 10 as it gives the masses options.  Can't let them have options.

Wakshaani

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« Reply #9 on: (19:12:33/06-17-16) »
Capital, as income was wonky. (For instance, CEO types who carried $20 million a year in stock options but took home a $1 annual salary counted as the bottom quintile for income) ... thus wealth, not income, distribution.

AirBreather

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« Reply #10 on: (13:06:25/06-18-16) »
That quote about living on 1 nuyen a day was in Ghost cartels I believe....
*snip*

Thanks for the source ref.

*snip*
The in-game lesson is lots of little fee's add up to keep the Wage-slaves and SINless in place.  The game hand waives this for PCs with the Lifestyle costs so we're not tracking each little nickle and dime.  But for the bigger picture your lower income masses are kept stagnant and immobile by simply charging them a Nuyen or 10 at every turn.

Your third world masses living on a Nuyen a day for example are basically locked in place because you need a Licence or Toll to go anywhere else legally.  And trusting your children to smugglers isn't normally a good idea.  And once the Labor Market is more or less locked in place the local Corp subsidiaries are free to pay as little as possible since they're the only game in town. 

As for the OPs wonder drug, pretty much needs to be a "food-pill", yes you can get a few billion Nuyen from the Masses but your margins are going to be crap because of overhead costs.  Global distribution of a physical product is pretty expensive as it turns out.  You're better off with a wonder drug or wonder food marketed to the top 20% and charge 100 Nuyen a pop.  Same ballpark gross, but a fraction of the overhead.  Plus some trickle down sales to the folks who want to be like the top 20%.  It's where the money is, and it's where a majority of the product development is likely focused in most Corps. 

Plus a Nuyen a day food pill would be crushed pretty fast by the big 10 as it gives the masses options.  Can't let them have options.

Ah, alright. That is a perfect break-down, thank you. Here are my revisions:

- High-tier food pill: 100 nuyen. Targeted to the top 20% of the population or so.
- Mid-tier food pill: 20 nuyen. Targeted to... Everybody except the top 20% and the ultra-poor.
- Low-tier food pill: 1 nuyen (or less). Not on open market; various suppressing factors to deal with...

Capital, as income was wonky. (For instance, CEO types who carried $20 million a year in stock options but took home a $1 annual salary counted as the bottom quintile for income) ... thus wealth, not income, distribution.

Hmm. Right. Thanks for the clarification.

...

The BIG QUESTION is, how would some crazy amount of (gross) income like the 2,550,000,000,000 nuyen come about? Or even a trillion nuyen a year, to keep it simple.

Make it more of a dream scenario:
- Effectively zero production costs.
- Fully automated warehousing, robotic shipping and overland transport.
- Not calculating loss due to thefts, runs, etc.

Lets see... To make 1 trillion nuyen...
- With the 'high tier food pill' concept (100 nuyen a pop), that would require 10 million individual unit purchases (on the low purchase scale).
- On the highest individual scale (1 purchase per day, totalling 36,500 nuyen per year), it would require about 28,398 mass/bulk/combined purchases.

- With the 'mid range food pill' concept (20 nuyen a pop), that would require 50 million individual unit purchases (on the low purchase scale).
- On the highest individual scale (1 purchase per day, totalling 7,300 nuyen per year), it would require about 136,987 mass/bulk/combined purchases.

So... The target amount of consumers would be...
- More than 10 million individuals capable of buying a food pill at 100 nuyen, ONCE, per year;
- More than 50 million individuals capable of buying a food pill at 20 nuyen, ONCE, per year;
- More than 28,400 individuals capable of buying food pills at a total combined cost of 36,500 nuyen per year;
- More than 137,000 individuals capable of buying food pills at a total combined cost of 7,300 nuyen per year;

The smallest 'bulk' market would be under 200,000 individuals while the largest 'single sale' market would exceed 60 million individuals. Considering the world pop of 7 billion, those numbers would range from less than 1% (for bulk purchases) to ALSO less than 1% (for single purchases)...

Huh.

Those numbers are actually looking pretty realistic now. Lets see what happens with a fully rounded 1% in each type. 1% of 7 billion is... 70 million (70,000,000).

(BETTER MATH BELOW, I have no idea what I was doing above!!!)

- 70 million individuals that buy a food pill that costs 20 nuyen, ONCE, per year, bring in: 1.4 billion nuyen
- 70 million individuals that buy a food pill that costs 100 nuyen, ONCE, per year, bring in: 7 billion nuyen

- 70 million individuals that buy a total amount of food pills that have a combined cost of 7,300 nuyen per year, bring in: 511 billion nuyen
- 70 million individuals that buy a total amount of food pills that have a combined cost of 36,500 nuyen per year, bring in: 2.6 trillion nuyen (2,555 billion)

The above was 1%. What would ***20%*** look like?! 70 million times 20 = 1.4 billion (1,400,000,000).

- 1.4 billion individuals that buy a food pill that costs 20 nuyen, ONCE, per year, bring in: 28 billion nuyen
- 1.4 billion individuals that buy a food pill that costs 100 nuyen, ONCE, per year, bring in: 140 billion nuyen

- 1.4 billion individuals that buy a total amount of food pills that have a combined cost of 7,300 nuyen per year, bring in: 10.2 trillion nuyen (10,220 billion)
- 1.4 billion individuals that buy a total amount of food pills that have a combined cost of 36,500 nuyen per year, bring in: 51.1 trillion nuyen (51,100 billion)

Soooo....

Gross income could be expected to range from 1.4 billion nuyen (for 70 million units at 20 nuyen) to (the unrealistic high of) 51.1 trillion nuyen (for 511 billion units at 100 nuyen each).

Yay! Math! :P

Thanks everybody.  ;D

~AB

Wakshaani

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« Reply #11 on: (13:39:06/06-18-16) »
As a comparison, Wal-Mart's income for 2015 was 485 Billion (The largest of any corp), minus operation costs, the net was 16 billion.

http://www.marketwatch.com/investing/stock/WMT/financials

The only official list of Megacorp income was from the first Corporate book, where... hrm. Renraku I think? was 220 billion. I'd have to go check to get the exact name and value. Mind you, the economic realities of, what, 1993 I think when it was released? Are a *tad* different than today. Inflation alone will make a difference (adjusting for the 93-16 inflationary rate, for instance, would mean the 220 B figure would be 366 B instead) ... but, you know, just as an example.

Agricultural products, for instance, bring in steady income, since everyone has to eat, but the outlay is *huge* compared to the return, so your profit margins are awful. Energy, meanwhile, is highly volatile, with huge profits some year and net losses in others. If you look at the current Forbes 500, for instance, you won't find anyone heavily-invested in the energy industry, while the top 20 has, what, two?

Money is fun!

AirBreather

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« Reply #12 on: (17:16:30/06-18-16) »
As a comparison, Wal-Mart's income for 2015 was 485 Billion (The largest of any corp), minus operation costs, the net was 16 billion.

http://www.marketwatch.com/investing/stock/WMT/financials

The only official list of Megacorp income was from the first Corporate book, where... hrm. Renraku I think? was 220 billion. I'd have to go check to get the exact name and value. Mind you, the economic realities of, what, 1993 I think when it was released? Are a *tad* different than today. Inflation alone will make a difference (adjusting for the 93-16 inflationary rate, for instance, would mean the 220 B figure would be 366 B instead) ... but, you know, just as an example.

Agricultural products, for instance, bring in steady income, since everyone has to eat, but the outlay is *huge* compared to the return, so your profit margins are awful. Energy, meanwhile, is highly volatile, with huge profits some year and net losses in others. If you look at the current Forbes 500, for instance, you won't find anyone heavily-invested in the energy industry, while the top 20 has, what, two?

Money is fun!

Yeah, I didn't see much income figures anywhere. One I did remember was a reference to Ares' after costs profit - a figure of 2 trillion nuyen. (Don't know which version, year, etc...)

I'll check the first corp book. My current timeline/setting is VERY much off the rails, so this would be more so of it. :D

~AB