Intercountry Income Inequality Research Articles

Global Trends in Differentiation of Population Income

Purpose of the study. Identification of global trends in inequality in the distribution of the population income. In accordance with the goal, the following tasks are set: 1) to examine current international research that addresses the problem of income distribution inequality of the population; 2) assess the differentiation of the population income at the global and regional levels; 3) on the basis of the Gini and Theil indexes, to analyze the dynamics of income inequality of the population within and between countries of the world.Materials and methods. In the process of preparing the article, theauthor used data from international reports, analytical statistical materials, scientific works of Russian and foreign scientists. The scientific methods of cognition were used in the work: analysis (to assess changes in indicators of income inequality of the population), synthesis (to determine the relationship between inter-country and intra-country income inequalities of the population), graphical (to build graphs that reflect the dynamics of changes in the distribution of national income and assets among the population, Gini coefficient, Theil index). These methods made it possible to identify the scale and trends in the differentiation of the population income in the world.Results. The problem of uneven distribution of the population income was investigated. It has been established that inequality in the population income differs significantly between regions of the world, and the level of inequality of the population in terms of income within countries is much higher than the level of inequality between countries. An assessment of the current state is given and trends in the differentiation of the population income in the world based on the Gini index and the Theil index are revealed.Conclusion. It has been established that the problem of income differentiation of the population is in the focus of attention of both the scientific community and international organizations, namely: the United Nations, the Organization for Economic Cooperation and Development, the World Bank, Oxfam. The level of differentiation of the population by income between regions of the world differs significantly. The scale of global income inequality of the population now has reached the level that was observed during the heyday of Western imperialism. With the help of the Gini and Theil indexes, it was revealed that intra-country inequality is significantly greater than the inter-country income inequality of the population.

Climate econometric models indicate solar geoengineering would reduce inter-country income inequality

Exploring heterogeneity in the economic impacts of solar geoengineering is a fundamental step towards understanding the risk tradeoff associated with a geoengineering option. To evaluate impacts of solar geoengineering and greenhouse gas-driven climate change on equal terms, we apply macroeconomic impact models that have been widely applied to climate change impacts assessment. Combining historical evidence with climate simulations of mean annual temperature and precipitation, we project socio-economic outcomes under high anthropogenic emissions for stylized climate scenarios in which global temperatures are stabilized or over-cooled by blocking solar radiation. We find impacts of climate changes on global GDP-per-capita by the end of the century are temperature-driven, highly dispersed, and model dependent. Across all model specifications, however, income inequality between countries is lower with solar geoengineering. Consistent reduction in inter-country inequality can inform discussions of the distribution of impacts of solar geoengineering, a topic of concern in geoengineering ethics and governance debates.

International income inequality, 2005–2011: what a difference 6 years can make

While much attention has recently been given to the rising inequality in high-income countries, particularly the US, inequality across countries has received less attention. Based on reports of the International Comparison Program, which provide the most accurate measures of PPP income at the country level, this study computes three highly recommended measures of intercountry income inequality for the years 2005 and 2011. A dramatic, and perhaps unprecedented, fall in intercountry inequality over the relatively short period of 6 years is noted. As a correlate of the fall in intercountry inequality, aggregate PPP GDP for six major high-income countries is compared with that for three large developing countries, and the dramatic increase over the 6-year period in the ratio of the total GDP of the three developing countries to that for the six high-income countries is noted, thus extending, from the most accurate data, the theme of the ‘rise of the South’ articulated in Human Development Report 2013.

Technological Change and Economic Growth

In a globalizing world economy, the reason for differences in economic growth and inter-country income inequality is explained on the grounds of technological differences. The goal of science and technology is to enable enterprises and individuals to use technologies more efficiently, as this results in reduced costs and enhanced productivity gains. The use of new technologies paves the way for production of new cheaper goods and for capital accumulation and, for that matter, for an enhanced international competitiveness of individual countries, as well as to an enhanced quality for scientific research institutions, while, on the other hand, contributing to cultural and political development of societies. The quality of growth rates is as much important as their size. One may ask the following questions in order to get a better understanding of whether growth has its reflections on people's life or not: Are people involved and included in growth process? Does everybody enjoy the opportunities driven by growth? Do new technologies or trade volumes increase the choices facing people? Is welfare level of the future generations planned? Or, else, who is cared about is today's generations only? Are markets accessible and open to everybody?

Bank Bailouts, International Linkages, and Cooperation

Financial institutions are increasingly linked internationally. As a result, financial crises and government intervention have stronger effects beyond borders. We provide a model of international contagion allowing for bank bailouts. While a social planner trades off tax distortions, liquidation losses, and intra- and intercountry income inequality, in the noncooperative game between governments there are inefficiencies due to externalities, a lack of burden sharing, and free riding. We show that, in absence of cooperation, stronger interbank linkages make government interests diverge, whereas cross-border asset holdings tend to align them. We analyze different forms of cooperation and their effects on global and national welfare. (JEL C72, G01, G21, G28)

Bank Bailouts, International Linkages and Cooperation

Financial institutions are increasingly linked internationally. As a result, financial crisis and government intervention have stronger effects beyond borders. We provide a model of international contagion allowing for bank bailouts. While a social planner trades off tax distortions, liquidation losses and intra- and inter-country income inequality, in the non-cooperative game between governments there are inefficiencies due to externalities, no burden sharing and free-riding. We show that, in absence of cooperation, stronger interbank linkages make government interests diverge, whereas cross-border asset holdings tend to align them. We analyze different forms of cooperation and their effects on global and national welfare.

International income distribution: comparing new ICP and the existing data

PurposeThe purpose of this paper is to provide a comparison of data on real (purchasing‐power‐parity – PPP) gross domestic product (GDP) per capita recently released by International Comparison Program (ICP) with the numbers reported in World Development Indicators (WDI) and Penn World Tables (PWT) which have been used by hundreds, perhaps thousands, of researchers over many years.Design/methodology/approachA descriptive comparison is first provided by listing cases of largest absolute and percentage differences between ICP and WDI and PWT numbers. Second, well‐recommended measures of cross‐country inequality in real GDP per capita are computed, and inequality in terms of ICP data are compared with that based on WDI and PWT data.FindingsFirst, there are huge differences for numerous countries between the ICP numbers and the WDI and PWT data. Second, many of these differences are much larger than the highly publicized cases of China and India. Third, since ICP numbers are more accurate, existing WDI and PWT data are noted to substantially understate intercountry income inequality. Fourth, comparison of ICP with WDI shows a pattern which is similar to that indicated by a comparison of ICP and PWT. Fifth, the huge discrepancies in data provided by highly reputed sources, and used by numerous researchers, in such a prime indicator of economic and social well‐being seem to reflect a notable phenomenon.Originality/valueFirst, this is apparently the only attempt to provide a comparison of the new ICP data on country‐level real GDP per capita with that reported in the highly reputed and widely used WDI and PWT. Second, the enormous differences for numerous countries should suggest much caution to researchers in using the existing WDI and PWT data series. Third, the substantial understatement of intercountry income inequality by WDI and PWT data should be noteworthy. Fourth, although authors of WDI and PWT will probably identify reasons for the differences and reformulate their PPP data series, the present study may suggest need for some reflections on the context in which such large‐scale discrepancies in a variable of primary economic and social significance have existed for many years.

Carbon dioxide emission and income: A temporal analysis of cross-country distributional patterns

This paper explores the relationship between the inter-country income inequality and CO2 emission and temporal shifts in such a relationship. It also examines how the mean per capita CO2 emission and its distributional inequality are related to the corresponding mean and the distributional inequality of income. The analysis is based on a cross-country panel data set at the level of country-group. Here environmental damage is treated as a private good and the technique of Lorenz and specific concentration curve analysis have been used as the basic analytical framework to argue that distributional inequality of income should be an explanatory variable in the Environmental Kuznets Curve relationship, along with the mean income level. In the empirical exercise, Johansen's cointegration analysis technique is used to explore existence of statistically significant cointegrating vector(s) relating mean emission and Specific Concentration Ratio of emission to mean income level and Lorenz Ratio of income, using a set of country-group specific time series data set which covers four country-groups (viz., Africa, America, Asia and Europe) and the World as a whole. The empirical results confirm that the inter-country income inequality has significant effect on the mean emission level and inter-country inequality of emission level for most of the country-groups considered.

Global inequality and international trade

The paper analyses the effect of widespread trade liberalisation on global income inequality. The analysis of the trend in global inequality during 1981--97, presented in the first part of the paper, shows that the apparent growth of income inequality among countries conceals a process of convergence. Some developing countries achieved significantly faster economic growth than the advanced industrialised countries and, though small in number, they actually account for a majority of the population of the developing world. Thus international inequality (i.e., the inequality of distribution of per capita incomes among the world's population) in fact declined even though the inter-country income inequality increased. The analysis in the second part of the paper shows (i) that while improved trade performance did have a stimulating effect on growth performance of countries, trade liberalisation had extremely varied effects on trade performance across countries, and (ii) that the distribution of benefits and costs of trade liberalisation across countries has been such as to reduce international inequality without affecting inter-country inequality. Copyright 2004, Oxford University Press.

Intercountry Income Inequality: An Expansion and an Update

In a recent contribution to this journal, Park (1997) examines the issue of intercountry income inequality and convergence at 5-year intervals during the period 1960–1990. In this note, using data from the same sources and the same methodology, we extend the analysis to all years between 1960 and 1995 as well as the more recent period 1990–1995.

Empirics of World Income Inequality

This article employs a common general formula for inequality indexes to answer several basic questions about intercountry income inequality in recent decades: Has inequality across nations increased or declined (and why have earlier studies yielded mixed results)? Have different rates of population growth played a significant role in the trend? Have large nations dominated the trend? Are the results robust over different inequality measures and different income series? Two findings stand out. First, different rates of population growth in rich and poor nations played the predominant role in determining change in the distribution of per capita income across nations. Second, the centuries‐old trend of rising inequality leveled off from 1960 to 1989. The dependency theory thesis of a polarizing world system receives no support.

An Alternative Examination of Intercountry Income Inequality and Convergence

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.

A Geographical Decomposition of Intercountry Income Inequality

We analyze the evolution of intercountry income inequality and its decomposition between and within four geographical clusters and their fifteen regions from 1960 to 1990 by applying the income-weighted entropy measure. Our analysis assesses the contribution of income inequality within and between the geographical clusters and their regions to three global trends: strong divergence between 1960 and 1968, slow convergence between 1969 and 1983, and stagnation between 1984 and 1990.

Intercountry Income Inequality: World Levels and Decomposition Between and Within Developmental Clusters and Regions

By applying the Theil index of income inequality and its decomposition between and within groups to income data adjusted for purchasing power parity on 115 countries between 1960 and 1985, we find that the worldwide level of intercountry income inequality declined steadily by 0.584% per annum, indicating a considerable overall convergence process. The decomposition analysis indicates that the dominant constituent of intercountry income inequality was the aggregate inequality among regions, followed by the aggregate inequality within regions. The decomposition also reveals that the contribution of income inequality among the clusters of LDCs, OECD countries and CPEs was very small.

Level of Development and Income Inequality: An Extension of Kuznets‐Hypothesis to the World Economy

Kuznets' hypothesis, which relates income inequality in a country with its level of economic development, is extended to the world system, and it is hypothesized that intercountry (world) income inequality first increases with world economic growth, but starts declining after reaching a turning point. Empirical status of the extension is explored on the basis of reasonably good income data that are comparable across countries and over time. A well-recommended inequality index is utilized for the study, which includes 115 market economies and covers the period 1960-80. The estimates appear to support the proposed extension fairly well. Copyright 1989 by WWZ and Helbing & Lichtenhahn Verlag AG

Intercountry inequalities in income and ‘index of net social progress’: Evidence from recent data

Intercountry income inequality is computed from real GDP data that became available recently from phase IV of International Comparisons Project. Similar inequality measures are also calculated for ‘index of net social progress’ proposed by Estes (1983) and for conventional GNP per capita. Although the three indicators are strongly and positively correlated, intercountry inequality indices derived from these are rather dramatically different.

The advantages and disadvantages of artificial pneumothorax in the treatment of pulmonary tuberculosis

In a globalizing world economy, the reason for differences in economic growth and inter-country income inequality is explained on the grounds of technological differences. The goal of science and technology is to enable enterprises and individuals to use technologies more efficiently, as this results in reduced costs and enhanced productivity gains. The use of new technologies paves the way for production of new cheaper goods and for capital accumulation and, for that matter, for an enhanced international competitiveness of individual countries, as well as to an enhanced quality for scientific research institutions, while, on the other hand, contributing to cultural and political development of societies. The quality of growth rates is as much important as their size. One may ask the following questions in order to get a better understanding of whether growth has its reflections on people's life or not: Are people involved and included in growth process? Does everybody enjoy the opportunities driven by growth? Do new technologies or trade volumes increase the choices facing people? Is welfare level of the future generations planned? Or, else, who is cared about is today's generations only? Are markets accessible and open to everybody?