Question

(b)    The global Gini coefficient has declined from about 0.68 to 0.62 during 1990 to 2010. However, in the same period, inequality was increasing in the vast majority of countries in the world. Explain why the world inequality can decrease in the period. (3 points)

Answer 1

• Inequality within nations is rather high but it isn’t escalating everywhere. Since the 1990s, income inequality has augmented in most developed economies. Inequality diminished in many Latin American economies from 1990 till the early 2010s but is escalating again in few of them.

• Inequality trends vary across nations at even similar degrees of development.

• Income inequity has diminished amongst nations in relative terms but is still greater than inequality within most nations. Absolute income distinctions between nations continue to grow. Robust economic growth in China & some other emergent economies of Asia has been the primary propeller of this reduction. However, this convergence isn’t distributed evenly, & the distinctions amongst some countries are still substantial.

• The world is far from the objective of equivalent opportunity for everybody: circumstances beyond a person’s control, such as race, gender, migrant status &, for children, the socio-economic status of their parentages, continue to impact one’s likelihoods of being successful in life.

• Group-based inequities are diminishing in some cases but still escalating in many others. Until & unless progress speeds up , leaving behind nobody will remain a distant objective by 2030.

• High / growing inequity not just hurts persons living in destitution & other disadvantaged clusters. It impacts the welfare of society as a whole.

• Highly inequitable societies grow more sluggishly than those with low disparity & are not successful at lessening poverty.

• In the absence of apt institutions & policies, inequities in outcomes create / sustain unequal prospects & perpetuate societal divisions.

• Escalating inequity has generated dissatisfaction, intensified political divides & can cause violent clashes.