You say that, but it’s obvious that some people at the top are getting much richer while most of the rest of us haven’t had a pay rise since the financial crisis.

It’s true that some of the top earners have seen huge pay rises over the past decade – FTSE 100 chief executive pay has nearly doubled. But that’s an absolutely tiny group: one hundred people out of a workforce of 32 million. That isn't the 1%, that's the 0.0003125%. What is true is that most people haven’t seen much of a pay rise for many years, and that seems to be what’s really the matter here.

People aren’t just mad about inequality – they’re mad about the unfairness of people getting bigger paycheques undeservedly while their employees get no rise at all.

It doesn’t look as if it’s undeserved, for the most part. Chief executives matter a lot – the strategic decisions they make affect every part of the firm they run, and it makes sense for a firm to spend several million if that’s what it takes to attract the top talent. Some think these pay packets are evidence of rent-seeking by executives, but financial markets seem to be very sensitive to the appointment and resignations of chief executives, suggesting that people with money on the line think that they matter a lot to firm value. And market movements after CEO deaths (both negative, after good CEOs die, and positive after bad ones die) have been getting larger and larger since the 1950s – a sign that they matter more and more to their firms, maybe because globalisation means top-level decisions matter more these days. It makes sense that big corporations would be willing to spend a couple of million quid for a chief executive that adds half a billion to the value of their firm, doesn’t it?

What’s more, it’s just not the case that cutting the wages of people at the top will boost the wages of people at the bottom. Companies spend what they need to to get resources they need – they don’t just have a big pot of money to spend on things. If we banned firms from spending more than a certain amount on IT services, we wouldn’t expect the money they had left over to go into workers’ wages, and we might find that the firms were less productive overall. Capping chief executive pay is similar to that.

Even if inequality has been falling, it’s still relatively high in the UK and the OECD and the IMF both say that inequality can slow down growth. Surely you accept that?

I’m afraid not. These studies tend not to be very high-quality, doing international ‘cross sectional’ comparisons that compare countries in a moment in time. That means that they end up comparing Sweden with Mexico, leaving out a lot of other factors that might be the cause of both Sweden’s lower inequality and its lower crime and poverty rates, and assuming what they’re trying to prove. But even though countries with lower inequality might have higher growth rates, that doesn’t mean that cutting inequality will boost growth rates.

A better method would be to do time series comparisons that look at what happens within particular countries when inequality rises or falls. A paper by Kristin Forbes that did that found that, actually, “an increase in a country’s level of income inequality has a significant positive relationship with subsequent economic growth.” Another paper, which tries to control for lots of the factors that usually confound results like the IMF’s and OECD’s, finds that across US states lower inequality is associated with lower subjective wellbeing.

My friend, the mysterious “Anonymous Mugwump”, points to evidence that wealth inequality caused by market factors, as opposed to cronyism, doesn't seem to be related to low growth, and that in African states higher inequality levels don't seem to be related with low growth either.

But inequality does undermine the social fabric of the country. You can’t put a price on that.

Does it? As Ben points out, a 2012 paper that looked at survey data from all 34 OECD countries over 30 years found no effect from inequality on honesty, altruism or civic-ness, very little effect on obedience or tolerance, and a positive effect on work ethic. Nor does inequality seem to allow the rich to buy elections – indeed most of the evidence suggests that, contrary to popular opinion, it’s very hard to buy an election. Donald Trump might have been a billionaire but it was his fame, not his money, that helped him win the election – he ran one of the cheapest campaigns of recent times and beat one of the most expensive ones.

Haven’t you read the Spirit Level? It contradicts everything you’ve been saying, and it’s evidence-based.

It’s bunk. Christopher Snowdon has demolished practically every important claim in the book, from inequality causing shorter lifespans to higher murder rates to unhappier citizens to less charitable giving, with most coming from “highly selective use of statistics” (to quote The Economist) – leaving out inconvenient countries to create the impression of a trend where there is none.

If what you’re saying is right, why does everyone care so much about inequality? Doesn’t their preference for more equality matter?

The great fact about inequality that most people who talk about it won’t admit is that people are very very bad at judging how unequal their societies actually are. An amazing paper asked people in all sorts of different countries, rich and poor, equal and unequal, to choose which ‘picture’ of society, below, was closest to showing the shape of incomes in their own society.