An Alternative Examination of Intercountry Income Inequality and Convergence

Abstract

In this paper, we examine trends in intercountry income inequality during the period 1960 – 1990. Our methodology involves two steps. The first step involves estimating the shares of global income accruing to percentiles of global population which are defined on the basis of relative national affluence. The second step involves using those income shares to calculate the Theil index. We then make use of this methodology and data from the Penn World Tables to address the issue of global income convergence over the period 1960-1990. We find that intercountry inequality did not improve during this period.