I detect a little confusion over global inequality at the moment. I often read, usually from those who care about equality, that the gap between rich and poor is growing and the world is getting increasingly unequal. I also hear, more often from those who don’t value equality so much, that the world is getting more equal all the time. So who is right?
First off, the question has to be more specific. By ‘global equality’, do we mean equality between countries, equality within countries, or an aggregate of both? These are all different things, and the first two have been pulling in opposite directions – equality between countries has narrowed in recent decades, while equality within countries has widened.
There is less of a gap between rich countries and poor countries than there used to be. This is good news. But, there is a growing gap between rich and poor in many of those countries. This is the bad news. If we put those together for a ‘total inequality’ metric, the two trends roughly offset each other between 1980 and 2005, and then equality has improved a little since then as between-country equality has accelerated.
There is one further complication, according to the International Development Institute at King’s College London, who have tried to get to the bottom of this recently. That complication is China, whose population is so huge that it muddles the global statistics. If you remove China from the equation, you find that between country inequality has widened fractionally, and that within-country inequality has stayed the same. So it turns out that the good news isn’t that good, but that the bad news isn’t terrible either.
In summary, it’s more or less correct to say that the world is getting more equal, and to say that it’s becoming more unequal – but because are over-simplified generalisations, it’s best to say neither.