Inequality Transparency Index 2020

WID.world’s Inequality Transparency Index gives an overview of the challenges ahead to end financial opacity around the globe and of the difficulties faced by researchers tracking income and wealth inequality.

Key results

• 28 countries have a score of “0”, which means that neither survey data nor fiscal data is available in this country. They appear in a striped pattern on the map. For these countries, the best we can do is to estimate their level of inequality via regional imputation, i.e. by assuming that they have a similar level of inequality as countries in the same region and/or with similar average income or political system.

• 8 countries have scores between 13 and 16.5, which are the highest grades given to date: Denmark, Italy, Sweden, Uruguay, France, the United-States, the United Kingdom and Norway. However, each of these countries also needs to make a fair amount of progress in order to reach fully transparent inequality statistics. This is particularly true regarding the measurement of inequality of wealth and capital income, for which no country in the world is fully transparent.

>> Check the Inequality transparency index

Why did we create the Inequality Transparency Index?

Having public access to quality data on the distribution of income and wealth is a condition for peaceful and informed debates on economic matters and public policies. In the current digital age, access to basic information on the distribution of income and wealth growth should be considered as a public good.

With the objective of giving a clearer picture of the administrative and fiscal data available, or the lack of in many countries, the World Inequality Lab created this index in 2019, in partnership with the United Nations Development Program. In addition, this index should also be considered as an incentive for governments to take steps in publishing transparent data and allowing easier access for researchers.

How is the Inequality Transparency Index constructed?

The index inequality transparency index ranges from 0 to 20 for each country, and is constructed around two dimensions:

• In the first dimension, we differentiate between four different sources of data: income surveys, income tax data, wealth surveys, and wealth tax data.
• In the second dimension, we evaluate various components for each of these sources: quality, frequency of publication, and access to the data.

>> Download the technical note 2020/12 for a detailed insight on the construction of the index

>> Download our transparency data table 2020 to understand how the index is calculated

References

• Burq, F., Chancel, L. (2020). Inequality Transparency Index. World Inequality Lab Technical Note 2020/12.
• Alvaredo, F. et al. (December 2019). Escaping the Inequality-Data Dark Ages. Project Syndicate.
• Alvaredo, F. et al. (September 7, 2020). Distributional National Accounts Guidelines. Methods and Concepts Used in WID.world.
• United Nations Development Program (2019). Human Development Report.

Contacts

Authors

• François Burq (WIL): francois.burq@gmail.com
• Lucas Chancel (WIL, IDDRI): lucas.chancel@sciencespo.fr

Media inquiries

• Olivia Ronsain: olivia.ronsain@wid.world; +33 7 63 91 81 68

Acknowledgements

The author gratefully acknowledges funding from the European Research Council (ERC Grant 856455) from the French National Research Agency (EUR Grant ANR-17-EURE-0001), as well as from the United Nations Development Program (Project 00093806).