If you're just joining us, here's what the book says (p. 284):
Worldwide, our differences in birth lottery placements, top to bottom, can be literally a million to one—a disparity ten thousand times greater than in, for example, a small Ohio suburb.‡
And that footnote leads to this:
The short version: in the small Ohio suburb where I was born, U.S. Census data place the median annual income at almost precisely the U.S. average. Census and other data place my birthplace’s range of real annual incomes at about $5,000 to $500,000, a factor of about 100. Globally, however, a family in a rough part of the Democratic Republic of the Congo might have just a tenth of the low end in my hometown—at most—while the children of the planet’s ninety-two families worth more than $10 billion will grow up in a household with an annual household income up to a thousand times greater than my hometown’s high end. The global range of incomes, therefore, is approximately ten thousand times greater than one might experience growing up in middle America.
Now to explain this estimate in a little more detail:
My personal ticket vendor in the birth lottery was a suburb in Northeast Ohio (not the one I grew up in, incidentally), that privacy in the Internet age tells me I shouldn't just slap up here randomly. If you get super-picky, you can figure out which one from the following data. According to the the 2010 U.S. federal census (data at http://factfinder2.census.gov/), the town's population of 22,258 had 5464 families into which a child could be born, and these families had a median income of $50,611—almost identical to the U.S. national average of $50,056.
In my birthplace, according to the census, 95.5 percent of households had between $10,000 and $200,000 of annual income, putting the range of expectations for nearly the whole town at a factor of 20. But that doesn't include the extremes, about which the census is silent.
The extremes are easily figured, though. At the low end, food stamps, unemployment beneefits, and similar programs create a practical floor of more than $5000 (see http://www.unemployment-benefits.org/StatePage.aspx?sn=ohio and http://www.cbpp.org/cms/index.cfm?fa=view&id=1269 for more). At the high end, the census says 137 local families make more than $200,000. Plotting a bell curve from the census data — rainy day fun!—the count above $500,000 rapidly vanishes to near zero. (This makes sense; the town is modest, and I've never seen anyone who looks like they make more than half a million a year there.)
In rough orders of magnitude, then, a conservative guess places the range of incomes from $5000 and $500,000 per year. So even in suburban Ohio—as "middle America" as anything you can conjure—a newborn’s economic situation can vary by a factor of one hundred.
Now let’s compare that range of expectations to the world as a whole.
Starting with the high end:
Win the birth lottery, and you’re heir to a throne or the child of a hedge fund manager on a hot streak, carrying wealth whose annual expansion can be calculated only roughly.
In 2012, the U.S. Internal Revenue Service released data on the 400 tax returns with the highest adjusted gross income for the years 1992-2009. (See http://www.irs.gov/pub/irs-soi/09intop400.pdf.) In every year since 2005, these top 400 returns have averaged more than $200 million in annual income. (Incidentally, in 2009, six of these families paid no taxes whatsoever. The highest end is obviously appreciably more. See http://www.nationalmemo.com/david-cay-johnston-the-fortunate-400/.) Poking around and looking at the biggest reported incomes in Europe, the Mideast, Asia, and so on, a conservative, order-of-magnitude high-end for reliable income might be in the range of $500 million.
Obviously, a few people might make way more than that for a while. Hedge fund managers have sometimes made as much as $1.5 billion (see http://visualizingeconomics.com/2006/05/28/is-15-billion-the-highest-income-in-the-world/), but only sometimes. Forbes lists 92 families worldwide worth more than $10 billion (http://www.forbes.com/billionaires/list/), who might presumably average a 5 percent return on assets that large. This is obviously an inexact guess, but we keep coming back to about $500 million as conservative a plus-or-minus top end of human annual income.
The low end? In the Democratic Republic of the Congo, CIA and World Bank numbers place the average best-guess proxies for personal income—adjusting for purchasing power and whatnot—in the ballpark of a dollar per day. (See https://www.cia.gov/library/publications/the-world-factbook/geos/cg.html.)
We know that the low end would be even lower than that, so even were numbers are per capita and should theoretically come up with family size (nonsense in the real world, but that's what some might ask of the math), it's definitely in the ballpark to suggest that an infant unlucky enough to be born in the DR Congo enters a family with an annual income equivalent to maybe $500.
Bottom line, back-of-the-envelope math: our tickets to the birth lottery can vary worldwide by a factor of a million.
And considering that my hometown sported only a (surprisingly large) factor of about 100, global inequality works out to be about ten thousand greater than in the small Ohio town where I was born.