World Income Inequality in the Global Era (original) (raw)
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A new dataset for estimating the development of global inequality between 1820 and 2000 is presented, based on a large variety of sources and methods for estimating (gross household) income inequality. On this basis, and two sets of benchmarks for estimating between-country inequality (the Maddison 1990 benchmark and the recent 2005 ICP round), we estimate the evolution of global income inequality and of the number of people below various poverty lines over the past two centuries. We find that between 1820 and 1950 increasing per capita income is combined with increasing global inequality, and with an increase in the absolute number of people below the poverty line. After 1950 global inequality as measured by the Gini coefficient remains more or less constant, and also the number of poor starts to decline in absolute terms. It also appears that the global income distribution was uni-modal in the 19 th century, became increasingly bi-modal between 1910 and 1970 with two world wars, a depression and de-globalization, and was suddenly transformed back into a uni-modal distribution between 1980 and 2000.
World Income Inequality 1820-2000 1
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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 significant – and worrying features of the development of the world economy in the past 200 years. For this reason, the subject has become one of the most discussed topics in the social sciences; in particular the debate on the measurement and interpretation of recent trends in global inequality – is it still increasing? and why or why not? – has attracted considerable attention (Deininger and Squire, 1996; Jones, 1997; Bourguignon and Morrison, 2002; Milanovic, 2007 for a review of the debate). Economic historians have also intensely discussed the long term trends in the world that lead to the growing income disparities between nations...
Social Indicators Research, 2017
This paper is the first to decompose absolute global income inequality into its within-country and between-country component. The results show a continuous increase of absolute global inequality during 1850-2010, which can be separated into three distinct phases: (i) between 1850 and 1929, within-country inequality explained up to 76% of absolute global inequality, yet the growth rates of within-and between-country inequality were very similar; (ii) a sharp increase in the importance of between-country inequality occurred during the 1929-1950 period, which was followed by a period during which the within-and between-country components were approximately equally relevant; and (iii) after 1985, the growth in absolute global inequality was driven primarily by the accelerated growth of within-country income differences. Currently, within-country inequality explains 70% of absolute global market inequality, a figure close to that of the year 1850. Additional findings include that absolute income convergence between countries took place after 2005, that it is possible to reduce absolute inequality and to grow simultaneously, and that recently within-country net inequality has grown faster than market inequality. The main findings are preserved when different absolute decomposable inequality measures, sample sizes, and purchasing power parity exchange rates are used.
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Since the 1980s inequality has been rising in Europe, North America and parts of Asia. How does our understanding of global inequality dynamics change if coverage is extended to the rest of the developing world? To rebalance the perspective on global inequality trends, this paper surveys data and literature on recent inequality trends in Latin America, Asia, Africa and the Middle East. It finds that in these regions there are more countries with falling than rising inequality over the past 20 years, as measured by ginis of income or consumption inequality. At the global level, therefore, there are signs of inequality convergence, as inequality has been falling in countries with high inequality in the 1990s (particularly Latin America), and rising in historically low-inequality countries. We discuss the political and economic drivers of inequality decline in countries with a steady fall in the gini. This suggests some common trends across the globe, including the role of democratization, the rise of new social movements, the expansion of education and social safety nets and favourable commodity prices, in reducing income disparities. This paper calls for more country-level comparisons of inequality trends, to highlight the multiplicity of paths in this latest phase of globalization.
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Using social tables, we make an estimate of global inequality (inequality among world citizens) in early 19th century. We then show that the level and composition of global inequality have changed over the last two centuries. The level has increased reaching a high plateau around 1950s, and the main determinants of global inequality have become differences in mean country incomes
Global trends in relative and absolute income inequality
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.
1World Income Inequality 1820-2000
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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