Rich are still getting richer despite gains among poorGlobal inequality has stabilized at high levels in recent years, a report said Friday, despite gains among the poor in China and much milder disparities in incomes and wealth in Western Europe.
The 2018 World Inequality Report is based on a massive, interactive collection of data compiled by an international team of researchers that includes renowned economists Thomas Piketty and Emmanuel Saez. It shows inequality has soared since 1980, although the global top 1 percent saw their share of global income slip slightly after the 2008 financial crisis, to just above 20 percent.
At the same time, the share of global income going to the bottom 50 percent rose slightly, to just under 10 percent, thanks to gains in populous, fast-growing China and India.
The United States and Western Europe had similar levels of inequality in 1980, with the top 1 percent holding about 10 percent of income. But by 2016, the top 1 percent in Europe held a 12 percent income share, compared with 20 percent in the United States.
The bottom 50 percent of Americans saw their income share sink from more than 20 percent in 1980 to 13 percent in 2016, it said.
The report includes two charts illustrating the trends: In the United States, the income share of the top 1 percent surpassed that of the bottom 50 percent in the mid-1990s and has risen since, the two lines crossing in a big “X.” In Europe, the two lines have remained parallel, with the top 1 percent’s income share remaining well below that of the bottom 50 percent.
The authors of the report said the data it analyzed were collected from a wide range of government sources over 15 years. One of the aims of the study is to push governments to be more transparent about financial data to ensure that debates over inequality and the policies that affect income and wealth are well informed.
“Economic inequality is widespread and to some extent inevitable,” they said in the report’s summary. “It is our belief, however, that if rising inequality is not properly monitored and addressed it can lead to various sorts of political, economic and social catastrophes.”
While income for the top 10 percent of wealthiest people has soared over the past four decades, the gains have been most dramatic in India, Russia and the United States.
More in Economy
Central bank holds rates steady, adjusts up GDP forecast
Restaurant coupons to make a comeback as an app
[INTERVIEW] Korea Forest Service head sees huge opportunity in Indonesia
Tapped out and hunkered down, Korea stares recession in the face
Property owners get big tax shock