1983_The Level of World Inequality: How Much Can One Say

Review of Income and Wealth, 1983

This paper constructs estimates of income and consumption inequality for the world (124 countries), using various measures of inequality. It then goes on to examine the possible effects of various sources of error in the estimates, and attempts to set rough limits to the size of such eHects. Among the sources of error examined are purchasing power parities used for currency conversion, systematic errors in estimates of per capita incomes, differences in age structure, government tax and expenditure policy, and lifetime income effects. The paper concludes that, although the level of uncertainty in the estimates is too great to permit conclusions about, for instance, trends over time, it is clear that the level of world inequality is extreme, and that it is primarily due to differences in average incomes across countries rather than to intra-country inequality. 'A more detailed discussion appears in a lengthier version of this paper, "How Unequal are Material Standards of Living Within and Between Countries", by the same authors.

Several studies have recently found that world income inequality declined during the closing years of the twentieth century. However, these studies feature a number of shortcomings, including the use of outdated national income estimates to measure inequality between countries, as well as sparse data to capture the smaller (but growing) component found within countries. The current study addresses these concerns and offers new estimates of world income inequality based on 151 countries covering 95 percent of the world's population during the 1990–2008 period. Overall, the results are fairly compatible with prior efforts, lending greater confidence to earlier findings. Nevertheless, the results suggest that prior studies covering the 1990s overestimate the decline in between-country inequality, but underestimate the rise in within-country inequality. Consequently, total inequality did not begin to decline substantially until the post-2000 era. After presenting these estimates, I then examine factors associated with income mobility among the 15,100 subnational percentile groups in my data set. The results suggest that (a) the negative effect of inequality is larger than the positive effect of economic growth among the poorest 25 percent of the world's population, and (b) late industrialization has contributed to income convergence between countries, while economic globalization has primarily served to stretch income distributions within nations.

2007

This paper examines the nature and extent of global and regional income distribution and inequality using the most recent country level data on income distribution drawn from World Bank and UNU-WIDER studies for the period 1993-2000. The methodology used is a recently developed technique to fit flexible income distributions to limited aggregated data. Empirical results show a very high degree of global inequality, but with some evidence of inequality decreasing between the two years.

2011

Increasing global interaction between economies over the last few decades has lead to growing interest on the implications of globalization. Of particular interest has been the distributional impact of globalization and whether this has been equity enhancing. Chotikapanich et al (2011) estimated global and regional inequalities for 1993 and 2000. The main objective of this paper is to update their results to be based on the purchasing power parity data in the latest 2005 ICP round. A related aim is to examine the sensitivity of the inequality results to the use of alternative sets of real incomes derived using different sets of purchasing power parity data to convert income data into a common currency unit. The main finding of the paper is that the populist view that globalisation has increased inequality does not hold when inequality is measured at the global level. Between 1993 and 2005, inequality has consistently declined as measured both by the Gini coefficient and the Theil in...

Review of Income and Wealth, 2013

This paper provides a full decomposition of world inequality, as measured by the Gini coefficient, in the period 1970-2009. In particular, using the Analysis of Gini (ANOGI), the paper describes the evolution of between inequality, within inequality, and the impact of overlapping on both factors. While there is evidence that between inequality in the last decade significantly declined due to the rapid Chinese growth, within inequality and overlapping went in the opposite direction. Furthermore, with the exception of some Asian countries, the rest of the world has not moved significantly. As a result, world inequality remains high by any standard.

Journal of World-Systems Research, 2006

This review covers a range of measures and methods frequently employed in the empirical analysis of global income inequality and global income distribution. Different determinant factors along with the quantification of their impacts and empirical results from different case studies are presented. A number of issues crucial to the study of global income inequality are also addressed. These are the concepts, measurement and decomposition of inequality, the world distribution of income and inequality measured at different levels of aggregation:global, international and intra-national. We analyze income at each of these levels, discuss the benefits and limitations of each approach and present empirical results found in the literature and compare them with those based on the World Income Inequality Database. Research on world income inequality supports increased awareness of the problem, its measurement and quantification, the identification of causal factors and policy measures that af...

Research in Labor Economics, 2016

This paper aims to identify the significant determinants of income inequality in developed and developing countries. The empirical analysis of the panel of 147 countries over the period from 1980 to 2010 shows that for developed countries, the significant determinant of income inequality is public spending on education, and for developing countries, the significant determinants are public spending on education, affordability of financial resources, and infrastructural development. Furthermore, no significant evidence supporting the existence of Kuznets' curve is found.

2015

The aim of this paper is to present a new dataset of global inequality between 1820 and the present, based on the available historical evidence, and to tentatively analyse some of the results that emerge from these data. The importance of the subject hardly needs to be stressed: the enormous increase of inequality on a global scale is one of the most

This paper provides an overview of historic worldwide trends in relative and absolute income inequality. Depending on the concept used, inequality trends differ considerably. Inequality between countries increased strongly during 1820-2000 and started decreasing at the beginning of the twenty-first century, whether measured in relative or absolute terms. Within-country inequality, on the contrary, grew especially strongly during the last decades: Its growth rate accelerated after 1950 in absolute terms and after 1975 in relative terms. Absolute global inequality also increased substantially in the post-1950 period, whereas relative global inequality decreased slightly during this period.

2006

Global inequality is a relatively recent topic. It was not until the early 1980s that the first calculations of inequality across world citizens were done. 1 This is because in order to calculate global inequality, one needs to have data on (within-) national income distributions for most of the countries in the world, or at least for most of the populous and rich countries. But it is only from the early-to mid-1980s that such data became available for China, 2 the Soviet Union and its constituent republics and large parts of Africa. Before we move to an analysis of global inequality, however, it is useful to set the stage by delineating what topics we shall be concerned with and what not. This is necessary precisely because of the relative underdevelopment of the topic, reflected in the fact that the same or similar terms are often used in the literature to mean different things. We need to distinguish between inequality among countries' mean incomes (inter-country inequality or Concept 1 inequality as dubbed by Milanovic, 2005), inequality among countries' mean incomes weighted by countries' populations (Concept 2 inequality), and inequality between world individuals (global or Concept 3 inequality). Concept 1 inequality deals with convergence and divergence of countries' incomes, and although at first this line of work was couched in inequality terms (see Baumol, 1986), most of the later work used cross