Trends in global inequality using a new integrated dataset

Abstract

This paper presents preliminary evidence of the annual global income distribution since 1950 using a new integrated dataset that aggregates standardized country income distributions at the percentile level estimated from various sources in the World Income Inequality Database. I analyse the extent to which the main global inequality trends depend on specific distributive views, i.e. absolute or relative, or with more emphasis in specific parts of the distribution. The results show absolute inequality increasing almost continuously. Relative inequality has been clearly reduced in the long term but with most indices also showing a sharp decline since at least end of 1990s due to income differences between countries being narrowed. I also quantify the contribution of different countries and regions through changes in average income, in inequality or in population, showing that the main global trends are largely driven by the drastic changes experienced by China and India over these decade.

Growth and inequality convergence: the role of environmentally related impacts on human capital

“…This implies that while a 100 per cent increase in the incidence of EIH would worsen the change in Gini index by 10 to 16 per cent, the change in GE(−1) index worsens by 40 to 90 per cent. This result exposes the dangers of EIH in widening the inequality gap between the bottom and the top of the income distribution as well as corroborating the narrative that the income of the bottom of the global distribution has remain fairly stagnant in recent decades (see Gradín 2021). Likewise, the estimated convergence parameters from the GE1 (−1) models, ranging from 1.1 to 3.2 per cent, are much higher than corresponding estimates obtained in the Gini model (i.e.…”

“…In sum, while income inequality has been falling globally, the proportionate rate of decline is slower among lower-middle-income countries compared with the other income groups. This outcome is concerning, given that more of the world's poor are living in middle-income countries (Pande and Enevoldsen 2021) and that the income of those at the bottom of the global distribution of income has remained fairly stagnant in recent decades (Gradín 2021). As we shall see next, this stagnation in the distribution of income and the slower rate of inequality reduction among lower-middleincome countries seem to have coincided with declining but high levels of EIH in all developing countries.…”

“…However, by comparing the initial inequality values of all indices and the average over 1990-2019, one thing that is less contentious is the fact that all indices agree that inequality has being slowly declining since the 1990s. See Gradín (2021) for a detailed discussion of these trends in inequality.…”

“…GE represents generalized entropy. Ordinarily, GE(0) is equivalent to MLD, which is a relative inequality measure like the Gini index in that they both depend on the ratio of incomes to the mean(Gradín 2021) …”

Inequality and Public Policy in Asia

“…This in turn helped narrow between-country income gaps and reduce global income inequality. However, within-country inequality has risen during the same period in many developing and developed countries (Gradín, 2021;Gradín & Oppel, 2021). Those in Asia are no exception, despite rapid educational expansion, poverty reduction and export-driven macroeconomic growth.…”