Extreme Income Inequality Research Articles

A longitudinal analysis and projection of provincial murder trends in South Africa: Causation and spatiality (2022-2027)

This article conducts a longitudinal analysis of provincial murder trends in South Africa, examining the socio-economic and spatial factors contributing to violence. It highlights how extreme income inequality, unemployment, and regional disparities drive high murder rates, with a notable concentration in provinces such as Gauteng, Eastern Cape, and Western Cape. Utilising secondary data from the South African Police Service, the study identifies key motives for murder, including interpersonal conflicts, robbery, and gang violence. Forecasting techniques were employed to project murder trends, emphasising the urgency of targeted interventions in high-risk areas. Recommendations include implementing community-specific policing, conflict resolution programs, and economic support initiatives to address root causes. This research contributes a predictive perspective on crime trends, advocating for data-driven approaches to enhance public safety and reduce violence across diverse socio-economic landscapes in South Africa.

Efekat ekonomskog rasta na dohodnu nejednakost u Podsaharskoj Africi

In this paper, the way in which economic growth influences income distribution is examined with a focus on Sub-Saharan Africa (SSA). Despite considerable growth in a number of the SSA countries, the region has been slow in reversing the rising trend of income inequality. A large proportion of countries in the region globally rank among economies with extreme income inequality. The study covers a period from 1995 to 2015, due to the limited data on the measure of income inequality, the Gini index, for the largest number of the countries of the region. The Generalized Method of Moments (GMM) system was employed in examining this paradox. The findings of this research study do not only suggest the presence of an inverted-U relationship between economic growth and income inequality, but the supposition of the S-shaped curve hypothesis in the interplay of growth and inequality was also tested and confirmed. It can be concluded that in no way do spurts in economic growth bring about diminution in income disproportion in Sub-Saharan Africa.

Does Recomposed Institutions Quality Alleviate Extreme Income Inequality?

Does Recomposed Institutions Quality Alleviate Extreme Income Inequality?

Does Recomposed Institutions Quality Alleviate Extreme Income Inequality?

Does Recomposed Institutions Quality Alleviate Extreme Income Inequality?

Quantile panel-type analysis for income inequality and healthcare expenditure

This study investigates the causal relationship between Income Inequality and Healthcare Expenditure within a quantile panel-type causality framework using yearly panel data from 2004 to 2017. The empirical results show that within the high-growth regime of health expenditure to income ratio, reducing the deterioration of income inequality can make the ratio of health expenditure to income keep increasing. Besides, within the extreme income inequality regime, the ratio of health expenditure to income continues to increase, which can reduce the deterioration degree of income inequality. This paper presents evidence that to improve the continuous deterioration of income inequality; it should focus on the continuous increase in the ratio of health expenditure to income, not just the continuous increase in health expenditure. Accordingly, policy-makers should be cautious about the momentum between the ratio of health expenditure to income and income inequality when they reach the extremely quantiles.

ETHICAL ISSUES OF THE GLOBAL KIDNEY EXCHANGE PROGRAM AS VIEWED FROM A LOW-TO-MIDDLE COUNTRY’S PERSPECTIVE

Introduction: With a global shortage of organs for transplantation, Reese et al.1 describe an opportunity to significantly increase the global organ donor pool. The Global Kidney Exchange Program (GKEP) intends to overcome poverty barriers in Low-to-Middle Income Countries (LMIC) and immunological barriers in High-Income Countries (HIC), saving the lives of the LMICs’ patients and enhancing the quality of life and life expectancy of HICs’ patients, while a creating cost-saving initiative for healthcare funders. But not all bioethicists agree that the GKEP, in its current form, is an ethical solution. Methods: Based on the principles of the 2018 Declaration of Istanbul, arguments regarding ‘coercion’, ‘equitable access to transplantation services’ and ‘self-sufficiency’ are developed from the general viewpoint of a LMIC that would contribute “financial incompatible” donor-recipient pairs to the GKEP. Results and Discussion: The strongest argument supporting the GKEP is that it will save lives of LMICs’ patients that do not have access to transplantation or do not have the financial means to pay for the procedure, while in HICs it will increase the quality of life and life expectancy of “difficult to match” patients with immunological complexities. However, in a setting where renal replacement therapy needs to be rationed, dialysis allocation policies are often aligned with surgical criteria related to transplantation. When the GKEP are the only or the main transplantation strategy in a LMIC, the entry criteria for all renal replacement therapy will be skewed to recipients who meet the GKEP criteria. Therefore a select group of patients (those with living donors) will be more likely to be accepted for dialysis and transplantation. When the only lifesaving option available is dependent on having a living donor, the risk for donor coercion is undeniable. Coupled with environments of extreme income inequality, as in many LMICs, where the availability of poor and desperate people is abundant, fairly little safeguarding mechanisms could be put in place to protect against donor exploitation. Furthermore, if a situation arises where HICs will (only) perform and fund the transplants of patients meeting the (funding) GKEP criteria, then little incentives may exist for LMICs to transplant the patients who do not meet the GKEP criteria and develop deceased donation programs. Conclusion: In conclusion, the GKEP in its current form could create circumstances that put undue pressure on ESRD patients to have a living donor, as well as, lead to inequitable access to transplantation for patients in LMICs. Furthermore, the GKEP could create a funding dependency of transplant programs in LMICs on HICs, while undermining self-sufficiency efforts in LMICs. If these ethical issues can be addressed, the GKEP could save many lives globally. This study was done while MRdK was studying towards an Advanced Masters in Bioethics at KU Leuven and received a scholarship from the Professors Roger Borghgraef fund toward intuition an Advanced Masters in Bioethics. Reference: 1. Rees MA, Dunn TB, Kuhr CS, et al. Kidney Exchange to Overcome Financial Barriers to Kidney Transplantation. Am J Transplant. 2017;17:782-790. doi:10.1111/ajt.14106

On Addressing the Puzzle of Extreme Income Inequality: A Response to Agarwal and Holmes

On Addressing the Puzzle of Extreme Income Inequality: A Response to Agarwal and Holmes

Spousal resources and relationship quality in eight European countries

ABSTRACTWe relate relationship satisfaction and thoughts about leaving a romantic relationship to a couple’s relative and absolute resources and check for context-dependency of those associations. Our theoretical point of departure is that the more resources women have compared to their spouses, the higher their intra-household bargaining power to negotiate themselves out of unpleasant tasks, particularly in gender-egalitarian and very income equal and unequal societies. In traditional societies (which score low on the Gender Empowerment Measure (GEM)), the inflexible role of men within the household presumably prevents women from bargaining a better position, which in turn negatively affects relationship quality. Income equality (low GINI coefficient) may be a prerequisite for women’s bargaining position, where more inequality (mid-GINI) may be detrimental for it. Nevertheless, extreme income inequality (high GINI) may again be favorable for women’s relationship power. Using country fixed effects models on data from the Generations and Gender Surveys (GGS), we compare men and women who are in a couple (formed after 1995) for eight European countries. We find that absolute resources matter more than relative resources, at least for relationship satisfaction: Higher educated couples are more satisfied with their relationships, which could suggest lower stress levels in those couples (in more traditional contexts). Second, we observe GINI context-dependency of the association between relative education and relationship satisfaction for women and relative education and exit thoughts for men, although opposite to what we expected. Perhaps reference group theory or gender display theory can explain these unexpected results. Finally, we find that women have more break-up plans in societies with a lower score on GEM. This last result is consistent with the notion that bargaining only works in egalitarian contexts.

Diminished Expectations

In Latin America, the relationship between income and support for redistribution is weak and variable despite the region's extreme income inequality. This article shows that this condition is rooted in the truncated structure of many Latin American welfare states. Heavy spending on contributory social insurance for formal-sector workers, flat or regressive subsidies, and informal access barriers mean that social spending does far less for the poor in Latin America than it does in advanced industrial economies. Using public opinion data from across Latin America and original survey data from Colombia, the author demonstrates that income is less predictive of attitudes in the countries and social policy areas in which the poor gain less from social expenditures. Social policy exclusion leads the poor to doubt that they will benefit from redistribution, thereby dampening their support for it. The article reverses an assumption in political economy models that welfare exclusion unleashes demands for greater redistribution. Instead, truncation reinforces skepticism about social policy helping the poor. Welfare state reforms to promote social inclusion are essential to strengthen redistributive coalitions.

The evolving retail structure of mexico city

A recent economic census of Mexico City reveals the complexity of the retail structure, in terms of stores, sales, and location of its various components, ranging from public markets to traditional retail streets to more modern innovations like shopping malls and power centers. Data from an origin–destination survey for transportation identifies the characteristics of customers for various destinations, and permit us to position the city within a general sequence of retail evolution, roughly linked to income, hence level of economic development. Traditional locations such as downtown, the public markets, and retail shopping streets, have a long history in the city and largely serve the low-income population. More modern retail developments such as shopping centers, supercenters, and power retail have recently emerged to serve the well-to-do. This bifurcation of retail facilities and their clients is exacerbated by the extreme income inequality in the city, and by the fact that the automobile has become a fundamental indicator of social class in Mexico City. Without a car, the household depends on the elements of traditional retail—public markets and nearby retail streets—whereas households with a car are able to shop in the facilities of modern retail: supercenters, shopping centers, and big box stores.

Fairness in Winner-Take-All Markets.

The paper reports the first experimental study on people’s fairness views on extreme income inequalities arising from winner-take-all reward structures. We find that the majority of participants consider extreme income inequality generated in winner-take-all situations as fair, independent of the winning margin. Spectators appear to endorse a “factual merit” fairness argument for no redistribution: the winner deserves all the earnings because these earnings were determined by his or her performance. Our findings shed light on the present political debate on redistribution, by suggesting that people may object less to certain types of extreme income inequality than commonly assumed.

Income inequality and oligarchs in Russian regions: A note

We trace the rise of the so called oligarchs in post-Soviet Russia and examine their relationship to income distribution in Russia. When Russia moved to a market economy in the 1990s a new business elite evolved. Russia's distinctive path towards market economy, among other factors, gave rise to the oligarchs who now control large parts of the economy and have a strong standing within politics and society. Using a unique regional data set on the locations of oligarchs’ businesses across the Russian regions, we test Acemoglu's (2008) proposition that oligarchic societies experience extreme income inequality. Our results show significantly higher levels of income inequality in regions with a higher presence of oligarchs.

Income Inequality and Oligarchs in Russian Regions: A Note

We trace the rise of the so called oligarchs in post-Soviet Russia and examine their relationship to income distribution in Russia. When Russia moved to a market economy in the 1990s a new business elite evolved. Russia’s distinctive path towards market economy, among other factors, gave rise to the oligarchs who now control large parts of the economy and have a strong standing within politics and society. Using a unique regional data set on the locations of oligarchs’ businesses across the Russian regions, we test Acemoglu’s (2008) proposition that oligarchic societies experience extreme income inequality. Our results show significantly higher levels of income inequality in regions with a higher presence of oligarchs.

Book Review: Book Reviews

The Price of Inequality: How Today's Divided Society Endangers Our Future. By Joseph E. Stiglitz. New York: W. W. Norton & Company, 2013.523 pp. $27.95 (cloth); $16.95 (paper).The Great Divide: Unequal Societies and What We Can Do About Them. By Joseph E. Stiglitz. New York: W. W. Norton & Company, 2015. 428 pp. $28.95 (cloth).Over the last three years, President Obama, Warren Buffett, and Pope Francis each have warned about the dangers of income inequality. The Nobel Prize winner Joseph E. Stiglitz has done more than any other economist to explain why it matters. These two books, taken together, explain the roots of our crisis, its impact on our legal and political institutions, the objections against regulation, and a path toward restoration. The Price of Inequality is a sustained argument; The Great Divide collects and consolidates previous essays published in the popular media.The Price of Inequality shows that extreme income inequality corrodes our public and economic life. Stiglitz describes how we got here, why its a problem, the objections, why those objections are flawed, and a way out. With incisive analysis, Stiglitz slices through popular myths regarding the degree of our economic inequality and our social mobility, the effectiveness of trickle-down economics, the capacity of corporate institutions to self-govem, and the beneficence of banks. He explains the pitfalls of austerity, and why the government's budget is not like a household. He shows how the poor are left behind, discusses the impact of the financialization of the economy, and explains how inequality contributes to the corrosion of corporate governance and the erosion of social cohesion.Stiglitz sets out the broader social impact of the concentration of wealth in the hands of one percent of the population, and explains how we arrived here through rent-seeking-that is, when one owns, but does not create or produce. Instead of market discipline, rent-seekers game the markets in order to win. Market efficiency becomes a cover for the political activity that allows a small group of people to exploit the system for their personal wealth. These include subsidies from the government, credit card fees, and other activities. This description of rent-seeking seems remarkably congruent with the biblical prohibition against usury, and offers a coherent account for why and when usury should be condemned by the church: it corrodes our body politic.The Price of Inequality is charged with a cold, disciplined, moral anger at how our body politic has been manipulated to stack the deck against ordinary people. Stiglitz fleshes out economic issues by showing how social values such as fairness, social cohesion, and trust are also economically efficient. He shows how the role of banks and other kinds of businesses are politicized and benefit from their own inefficiencies. Economic inequality compounds disadvantages, determining where one is bom, what schools one attends, the possibility of entering the right eating club in Princeton. The stakes are high, because only by being exposed to those networks can one choose jobs where the incomes are exponentially greater than anyone else's. The ethic of fair play has been replaced by a belief that the value of money justifies any means of acquisition. Consequently, the accumulation of money crowds out other valuable activities, and even influences people to accept deceptive cognitive frames, such as the cigarette industry's efforts to reassure buyers that smoking is harmless, or the reports of think tanks supported by energy corporations that cast doubts on the scientific evidence of global warming (p. 160).Stiglitz carefully shows how the economy has become inefficient, unstable, and unfair. Incentive pay distorts the market, as executives exploit poor corporate governance to benefit themselves, rather than society or shareholders (p. 111). He explains how the discipline of economics underestimates relationships, and overestimates selfishness. …

Income Inequality and Urban Vulnerability to Flood Hazard in Brazil*

ObjectiveIncome inequality scholars suggest that extreme income inequality leads to spatial segregation, political power concentrated in the high‐income (elite) class, and thus, uneven public resource access. This work argues that income inequality may also predict higher levels of vulnerability of urban municipalities to climate‐related hazards.MethodUsing factor analysis and multilevel regression models, this research tests whether income inequality is a predictor of vulnerability to flood hazards.ResultsThe analysis shows that income inequality significantly predicts higher levels of a key component of vulnerability in urban Brazilian municipalities.ConclusionBy providing empirical evidence for the theorized linkages between income inequality, spatial segregation, and uneven public resource access, this work bolsters the claims of income inequality scholars who suggest high levels of income inequality have negative social consequences. Additionally, this work is relevant to climate change vulnerability scholars as it underscores the importance of considering income inequality as part of urban climate change vulnerability assessments.

Numeracy of Africans, Asians, and Europeans during the early modern period: new evidence from Cape Colony court registers

The lack of accurate measures of human capital formation often constrains investigations into the long‐run determinants of growth and comparative economic development, especially in the developing world. Using the reported ages of criminals in the Court of Justice records in the Cape Archives, this article documents for the first time numeracy levels and trends for inhabitants of the Cape Colony born between the late seventeenth and early nineteenth century: the native Khoesan, European settlers, and imported slaves from other African regions and Asia. This variety of origins allows us to compare contemporaneous levels of early modern development across three continents. By isolating those slaves born at the Cape, we also provide a glimpse into the dynamics of human capital transfer in a colonial setting. The Colony's relatively high level of human capital overall had implications for what was later to be the richest country on African soil, but the very unequal attainment of numeracy also foreshadowed extreme income inequality.

Inequality and Market Failure

We argue that market failure is a major and growing source of income inequality in the United States and in liberal market economies (LMEs) more generally. This market failure takes the form of occupational, educational, managerial, and capital rents that are generated by institutional barriers that restrict the free flow of capital or labor. We suggest that these four forms of rent can partly account for (a) the extreme income inequality at the very top of the LME income distribution as well as (b) the extreme income inequality that is also observed beneath the highest percentiles of the income distribution. The sharp increase in these forms of rent, when coupled with rent destruction at the bottom of the labor market, may well explain much of the takeoff in LME inequality in the past four decades. We conclude by outlining the empirical research agenda and policy prescription implied by a rent-based account.

Toward “Best Practices” in Scholar-Practitioner Relations: Insights from the Field of Inter-American Affairs

This paper explores a number of success stories of scholar–practitioner interactions on issues such as democracy promotion, fostering economic development, reducing extreme income inequality, and foreign policymaking toward the United States, among others, to argue that the so-called scholar–practitioner gap in International Relations might not be as wide as it may seem. It also highlights some of the salient limits to effective relations between the worlds of ideas and policy, and it discusses the main transmission belts—both individual and institutional—through which scholarly outputs influence the different stages of policymaking. The paper closes by proposing a number of “best practices” to enhance effective scholar–practitioner relations in inter-American affairs and beyond, including tying research to significant world events, synthesizing research findings into digestible components, developing relations of trust with allies in government, providing concrete policy recommendations based on rigorous research and cost-effectiveness analyses, and integrating practitioners into academic departments, among others.

Living Wage and Optimal Inequality in a Sarkarian Framework

Principles from the social thought of the Indian philosopher P.R. Sarkar are employed to show that there exists an optimal level of economic inequality that joins the values of economic justice and efficiency. Sarkar favored establishing a living wage as well as a maximum wage that allows for work incentives. It is argued that the primary justification for inequality is to provide incentives for individual productivity, and that the value of those incentives should not exceed the economic contributions they produce. To determine the relative importance of income incentives in motivating individual economic contributions, it is found necessary to develop a multifaceted model of human productivity. Such a model is developed using concepts from humanistic psychology. A Sarkarian individual productivity curve is introduced in diagrammatic analysis to demonstrate the existence of an optimal level of inequality, and also to explain the persistence of extreme income inequality.

Victims of the Chilean Miracle: Workers and Neoliberalism in the Pinochet Era, 1973-2002

This collection examines how the violent imposition of neoliberal economic policies affected Chilean working people during the Pinochet dictatorship (1973 – 89) and how the restoration of democracy in 1990 legitimized many of the labor relations and economic policies imposed by Pinochet. The articles demonstrate how the Chilean labor force was twice victimized: first by Pinochet and the military and then by the series of center-left civilian governments that workers had supported. Political violence ushered in an extreme form of neoliberalism by destroying labor unions, murdering and disappearing labor leaders, and dismantling a large public sector that had been built up since the 1930s and strengthened during the administrations of Eduardo Frei (1967 – 70) and Salvador Allende (1970 – 73). The violence unleashed against working people fragmented the class solidarity of important sectors of the Chilean working class, facilitated the restructuring of the labor force around neoliberal principles, and gave rise to new patterns of individualism, consumerism, and debt.The book’s most important contribution, however, is to document how poorly working people fared under the center-left governments of the Concertación, which consolidated Chilean neoliberalism and provided a veneer of legitimacy to a process that Pinochet was unable to complete with violence alone. The Concertación operated under a dark shadow cast by Pinochet, whose “designated senators” and undemocratic electoral laws constrained the development of democracy long after elected civilians assumed power. Indeed, until his arrest in London for human-rights violations in 1998, Pinochet’s power over the Concertación was so great that the contributors refer to the Pinochet era as enduring until 1998, eight years after the inauguration of civilian rule.Civilian administrations never jettisoned the Pinochet-era labor code, although they modified elements of it, and even though Chile experienced a period of spectacular economic growth and rising productivity in the 1990s, real wages did not increase, nor did the extreme income inequality bequeathed by the dictatorship improve. Although working people no longer feared the police, they experienced the increasing loss of permanent, well-paid jobs, replaced by temporary, low-wage employment and a corresponding erosion of the right to collective bargaining. The degradation of working conditions forced them to suffer disproportionately from Chile’s increased vulnerability to external economic shocks, which ultimately ended the “miracle,” after crises in Asia, Brazil, and Argentina between 1997 and 2002 threw the Chilean economy into a deep recession.Chile was not the only Latin American country where neoliberalism was erected on the ashes of a dirty war and nurtured by civilian governments, but this collection is one of the best examples of how the process unfolded in a country long heralded as a model of the free-market fundamentalism preached by the Chicago Boys. Two synthetic pieces on the Pinochet era (Peter Winn) and on the failure of social concertación under civilian administrations (Volker Frank) provide a useful context for understanding the six case studies that follow. The case studies examine both the industries that have traditionally sustained the Chilean economy — copper, textiles, and metallurgy — as well as those that have grown up under neoliberalism — fruit, fisheries, and forestry — displaying scholarship of uniformly high quality.The case studies are noteworthy for their analytic complexity. Interwoven into the analysis of the shifting class dynamics of Chilean society are interesting discussions about how new relations of power under neoliberalism degraded the environment, reconfigured gender relations (with ambiguous results for women), and reshaped cultural practices that replaced long-standing ties of worker solidarity with individualism and consumerism. The contributors also make it clear that despite being victimized by both Pinochet and neoliberal democracy, workers have continued to devise creative forms of resistance in their workplaces and communities. The result is a set of articles that explores the impact of political violence, democratization, and neoliberalism in Chile in detailed and highly nuanced ways.The collection addresses ongoing debates about the nature and viability of neoliberal democracy in Latin America. By the end of the book, it is difficult to escape the conclusion that although the return of civilian rule freed working-class Chileans from the political repression of the dictatorship, contemporary Chilean “democracy” is a shadow of what it was prior to September 11, 1973, when the Chilean military and its U.S. allies destroyed Latin America’s first experiment with democratic socialism. Winn suggests that scholars challenge any assertion that Chile’s neoliberal boom was a “miracle” with the question: “a miracle for whom — and at what cost?” (p. 12). Given the poor results of neoliberal democracy for Chilean workers, readers of this volume might also ask what hope there is for working people in Iraq, where the U.S. is currently struggling to erect another neoliberal democracy at gunpoint.