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A more equal world? An analysis of the global inequality trends in the period 2000-2020

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  • Guerriero, Arthur Zito

Abstract

This paper analyzes the evolution of global interpersonal income inequality in the last decades. While some authors emphasize that global inequality fell significantly between 2000 and 2020 (Milanovic, 2024), others argue that global inequality has remained constant (Chancel & Pikey, 2021) or even increased (Hickel, 2017). This paper contributes to the interpretation of this period by showing that while global inequality did fall between 2000 and 2020, this trend was not the result of a truly global convergence process involving all countries, as it was mainly driven by high growth rates in Asia. Combining data from the World Income Inequality Database (WIID) with population forecasts from the United Nations, an upward trend in global income inequality is projected, even if the economic shocks of COVID-19 and the invasion of Ukraine are not taken into account. The present study shows that a significant share of the Chinese population has reached such high-income levels that further increases in these incomes will contribute to a rise in inequality. Moreover, a further reduction in global inequality will require faster income growth in sub-Saharan Africa and South Asia, whereas sustained high growth rates in East Asia will contribute to higher inequality.

Suggested Citation

  • Guerriero, Arthur Zito, 2024. "A more equal world? An analysis of the global inequality trends in the period 2000-2020," Ruhr Economic Papers 1098, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    • Handle: RePEc:zbw:rwirep:306825
    DOI: 10.4419/96973275
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    References listed on IDEAS

    as
    1. Frank A Cowell & Emmanuel Flachaire, 2018. "Inequality Measurement and the Rich: Why inequality increased more than we thought," STICERD - Public Economics Programme Discussion Papers 36, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
    2. Sudhir Anand & Paul Segal, 2008. "What Do We Know about Global Income Inequality?," Journal of Economic Literature, American Economic Association, vol. 46(1), pages 57-94, March.
    3. Carlos Gradín, 2021. "Trends in global inequality using a new integrated dataset," WIDER Working Paper Series wp-2021-61, World Institute for Development Economic Research (UNU-WIDER).
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    More about this item

    Keywords

    Global inequality; income distribution; China; convergence; projection;
    All these keywords.

    JEL classification:

    • D30 - Microeconomics - - Distribution - - - General
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution

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