Abstract
Recent studies of trends in world income inequalities show that results differ significantly depending on whether income is measured through Purchasing Power Parities (PPP)- or exchange rate (FX)-based data. Korzeniewicz and Moran (1997), for example, relying on FX-based national income data, argue that world income inequalities rose during the 1980s. Firebaugh (1999), on the other hand, using PPP-based national income data, counters that world income inequalities declined through the same period. Both sets of authors subsequently have acknowledged and continued to debate the relative impact of PPP- and FX-based data in the assessment of world income inequalities (Firebaugh 2000; Korzeniewicz and Moran 2000).
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