Global Ideas on Inequality

In the past, poverty reduction or alleviation was the focus of global debates, projects and initiatives, and it came with the assumption that economic growth would automatically lead to improved welfare. Now, however, the insight that there is too much inequality between people and countries has also become an important point in global discourses. The tension between development advances on the one hand and problematic tendencies of growth of inequality on the other has been discussed by Angus Deaton in The Great Escape (2013). Deaton argues that, while many people in the world are now much better off than in previous times, there are still millions of extremely poor people. What is interesting today is the high degree of inequality between people in the world. This situation implies that the world has moved beyond a bipolar structure of poor and rich countries and towards a world with not only rich and poor countries but also many in the middle. In addition, most countries of the world now have rather high degrees of internal inequality. Therefore, inequality within countries is on the rise. On a world society scale this means that the differences between people are greater than the differences between countries. Branko Milanovic’s work is particularly instructive when it comes to changing patterns of global inequality. He found a very high level of global inequality in the late 1990s and a significant increase in inequality between 1988 and 1993 (Milanovic 2005: vii). Similarly, Thomas Piketty’s Capital in the Twenty-First Century (2014) analyzes the history of wealth and the reasons for unequal distribution on a world scale. He also reports rising inequality as an expected outcome of the current global political economy.

However, not only is there a linear development towards greater global inequality but, according to OECD data for its own member states, there is also an ‘inequality convergence’ or a decline in inequality (in household disposable income) in the most unequal countries and a rise of inequality in those countries that used to be most equal. Sweden, for example, traditionally one of the most equal countries in the world, has seen a significant rise in inequality. At the same time, a middle-income country like Turkey has experienced a decline in inequality (Causa et al. 2015). With reference to the global economic and financial crisis of 2007/2008, the International Labour Organization (ILO)’s World Employment Social Outlook (2015) reports a similar trend; namely, in high-income countries inequality has risen following the crisis, and the gap between high- and middle-income economies has been narrowing.

Several global social policy actors, particularly international organizations, have turned such information and findings into global social policy ideas and prescriptions, and have generated global discourses on inequality and social policies. To mention only a few that carry inequality in the title, there is the World Bank’s World Development Report 2006: Equity and Development; the ILO’s World of Work Report 2008: Income Inequalities in the Age of Financial Globalization, and its Global Wage Report 2014/15: Wages in Income Inequality; the United Nations Department for Economic and Social Affairs (UN DESA)’s Report of the World Social Situation 2013: Inequality Matters; the OECD’s Divided We Stand: Why Inequality Keeps Rising (2011); and the UN Development Programme (UNDP)’s Humanity Divided: Confronting Inequality in Developing Countries (2014).

More concretely, current reports illustrate the problem of inequality in different ways. For example, the OECD (2015c) first illustrates that the richest 10 per cent of the population have 9.6 times more in income than the poorest 10 per cent, with the gap getting wider. The report then argues that additional degrees of the extent of global inequality emerge when looking at the poorest 40 per cent, which includes many of those people with temporary, part-time and other precarious working arrangements. This perspective reveals that these poorest 40 per cent are often not benefitting from economic growth and have even seen a decline in their income. Oxfam even finds that for 2014 ‘the richest 1% of people in the world owned 48% of global wealth, leaving just 52% to be shared between the other 99% of adults on the planet’ (Hardoon 2015: 2; see also Social Watch 2015b). These are only two examples among many that demonstrate the interest in finding ways of collecting and presenting data to show that the gaps are widening and that inequality at a global scale is no longer an issue of the comparison of and relationship between states; there is an increasing concentration of wealth at the (very small) top of populations within states.

The relationship between income and wealth is another important aspect in understanding inequalities, and here it has been shown that wealth is more concentrated than income (OECD 2015c). Regarding the different connotations associated with inequality of income and wealth, respectively, Piketty points out that wealth inequalities are often less accepted by public moral views than those based on income. In the case of income inequality, the popular assumption is that the difference is related to individual talent and effort (Piketty 2014: 241).

Other forms of inequality, such as health inequalities (see, for example, WHO 2015), inequalities in access to education (see, for example, UNESCO 2008) or gender inequality (see, for example, UN Women 2015), are also subject to global ideas and discourses. In particular, global accounts of gender inequality appear to be slightly more positive and optimistic. For example, gender differences in employment are shrinking in the OECD world, which leads to lower income inequalities on that account (OECD 2015c). However, there are still considerable differences in gender equality on the global level. As the UN (2015b: 13) reports, in almost all countries in Asia, for example, the participation of women in the labour market is below 40 per cent (compared to 75 per cent of men).[1]

Given that inequalities based on age, gender and other factors do not often appear in isolation, an Overseas Development Institute (ODI) report has emphasized the problem of intersecting inequalities. With reference to Kabeer (2010), the notion of intersecting inequalities refers to ‘the “deep exclusion” of groups of people who suffer multiple forms of discrimination and disadvantage—and the need to tackle such intersecting inequalities in order to complete the job of eradicating absolute poverty’ (ODI 2014: 1).

Accordingly, the global discourse on inequalities is a broad and complex field made up of the illustrations, explanations and prescriptions of global social policy actors. Given that SDG10 addresses inequality, it is likely that the issue will continue to be subject to such reports. This prospect indicates a current emphasis in global discourse on placing issues of poverty in the context of a connected world and presenting data to show the comparative relationships between different places in the world. Income inequality is also often emphasized. Other and to some extent related debates concern gender inequalities, health inequalities and other inequalities related to particular groups.

  • [1] More data can be found at WomanStats Database, the most comprehensive compilation of information on the status of women in the world.
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