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Global Inequality and Policy

Paper Session

Saturday, Jan. 6, 2018 10:15 AM - 12:15 PM

Marriott Philadelphia Downtown, Grand Ballroom Salon E
Hosted By: American Economic Association
  • Chair: Emmanuel Saez, University of California-Berkeley

The Elephant Curve of Global Inequality and Growth

Facundo Alvaredo
,
Paris School of Economics
Lucas Chancel
,
Paris School of Economics
Thomas Piketty
,
Paris School of Economics
Emmanuel Saez
,
University of California-Berkeley
Gabriel Zucman
,
University of California-Berkeley

Abstract

This paper presents new evidence on global inequality and growth since 1980 using consistent inequality data distributing total National Income in the World and Wealth Income Database. Since 1980, inequality increased almost everywhere but at very different speeds. We combine the data across all countries to analyze world inequality. Global inequality has increased since 1980 in spite of fast growth in large emerging countries. We plot the curve of cumulated growth from 1980 to 2016 for each percentile of the global distribution of income per adult. This curve has an elephant shape as growth rates have been particularly high around the median (due to growth in China and India), growth rates have been low for the middle classes of advanced economies, and growth rates have been explosive for the global top income earners. We estimate the future evolution of global inequality between now and 2050 combining projected macro growth rates and within country inequality evolution based on past trends.

From Communism to Capitalism: Private Versus Public Property and Inequality in China and Russia

Filip Novokmet
,
Paris School of Economics
Thomas Piketty
,
Paris School of Economics
Li Yang
,
World Bank and Paris School of Economics
Gabriel Zucman
,
University of California-Berkeley

Abstract

This paper combines national accounts, survey, wealth and fiscal data (including recently released tax data on high-income taxpayers) in order to provide consistent series on the accumulation and distribution of income and wealth in China and Russia over the 1978-2015 period. We contrast the different speed and magnitude of privatization observed in the two countries and relate these findings to the differences in inequality levels.

Applying Generalized Pareto Curves to Inequality Analysis

Thomas Blanchet
,
Paris School of Economics
Bertrand Garbinti
,
Bank of France
Jonathan Goupille-Lebret
,
Paris School of Economics and GATE-LSE
Clara Martinez-Toledano
,
Paris School of Economics

Abstract

A generalized Pareto curve is defined as the curve of inverted Pareto coefficients b(p), where b(p) is the ratio between average income or wealth above rank p and the p-th quantile Q(p). This paper presents and discuss how this concept can be a useful tool to analyze the dynamics of the wealth and income distributions, using data for France and Spain.

Extreme Inequality: Evidence From Brazil, India, the Middle-East, and South Africa

Facundo Alvaredo
,
Paris School of Economics
Lydia Assouad
,
Paris School of Economics
Lucas Chancel
,
Paris School of Economics
Marc Morgan
,
Paris School of Economics

Abstract

This paper presents new findings about inequality dynamics in Brazil, India, the Middle East and South Africa from the World Wealth and Income Database (WID.world). We combine available tax data, household surveys and national accounts to produce estimates of the distribution of personal income, using concepts coherent with macroeconomic national accounts. We document an extreme level of inequality in these countries, with top 1% income shares above 20% and top 10% income share above 50% of national income. We discuss the diversity of national contexts underlying the trends and levels observed, including racial or territorial discrimination in Brazil and South Africa, deregulation policies in India and concentration of oil resources in the Middle East.
Discussant(s)
Thomas Blanchet
,
Paris School of Economics
Lucas Chancel
,
Paris School of Economics
Emmanuel Saez
,
University of California-Berkeley
Li Yang
,
World Bank and Paris School of Economics
JEL Classifications
  • E0 - General
  • H1 - Structure and Scope of Government