“Ten facts about inequality in advanced economies”

Economic inequality is on the rise after a historic decline, and the trend is especially dramatic in the United States, as outlines the paper “Ten facts about inequality in advanced economies“, by Lucas Chancel.

Income and wealth inequality was very high a century ago, dropped in the 20th century, and has been rising at different speeds across countries since the 1980s. The financial crisis of 2008 does not appear to have inverted this trend. At the global level, while between-country inequality mattered more than within-country inequality in the 1980s, it is the opposite today. The rise of inequality has not been counterbalanced by an increase social mobility. The reduction of gender pay gaps has tempered the rise of inequality in recent decades, but gender inequality remains particularly high among top income and wealth groups. Racial inequalities remain large as well. Evidence suggests that trade and technology alone cannot explain large inequality variations across rich countries. Shifts in tax and wage setting policies, as well as differences in educational and health systems matter a lot.

Watch the presentation of this paper at the Peterson Institute conference on “Combating Inequality” (2019.10.17)

“10 facts about inequality in advanced economies” in a nutshell

1. Inequality data remains scarce in the digital age

2. Income inequality rose at different speeds since the 1980s, after a historical decline

3. Rich countries have become richer but their governments have become poor

4. Capital is back, for a few

5. The Great recession did not halt the rise of inequality in most high income countries

6. Global inequality is now more about class than nationality

7. Higher inequality is associated with lower mobility rates

8. Gender and racial income inequalities were reduced in the 20th
century but remain high

9. Equal access to education, health and high-paid jobs are key to lift
pretax income at the bottom of the distribution

10. Tax progressivity has shaped the dynamics of inequality at the
top

Composition of personal wealth in France, 2012

? Any questions ?

Author, Lucas Chancel: lucas.chancel@psemail.eu

Media requests: press@wid.world ; +33 7 63 91 81 68