Widening of Global Inequality: A Matter of Real Concern

While the world is engaged in recovering from the COVID-19 pande­mic, threatening lives and livelihoods, one thing that stares at all of us is the rise in inequality—the poor–rich divide across the world. In fact, reading global inequality trends indicate that intra-country inequalities are rising when compared to the inter-country disparities. Whether it be evaluated in the income domain or the wealth domain, there is a stark divide that grows unabated. The richest 10% of the world population appropriates 52% of the global income (76% of global wealth) as against the poorest 50% sharing 8.5% of the global income (World Inequality Report 2022). The average income of the top 10% income earners remains at $1,22,100 vis-à-vis the bottom half has an average income of $3,920, conveying roughly a 40-times gap in these averages (World Economic Forum 2021). Such an income divide could vary in different nations with a slight betterment in the European region as compared to others. A similar scene on the wealth domain paints a grim picture where the poorest half possesses 2% of the global wealth, while the top 10% has 76% of the global wealth. In the wealth domain too, the average value of the wealth of the poorest half is 350 times lower than that of the top 10%. The regional divide across the globe situates Europe to be the most equal against the African region, which is the most unequal with regard to income and wealth inequality.

The incidence of such inequalities when read against the average income levels of countries shows that there is no systematic response between the two, given that
income-rich countries like the United States have greater inequality alongside Sweden with relatively compressed inequality. Similarly, low- and middle-income countries like India, Brazil, and China display extreme inequality against Malaysia and Uruguay that have moderate levels of inequality. This confirms that the levels of income have very little to do with the inequality derivative and that the contention of inequality responding to the transitions in the level of income is perhaps misplaced. Hence, inequality is perhaps not inevitable rather than a systematic outcome of political choice.