Poverty and income inequality

Laurence Boone, Antoine Goujard, 04 March 2019

The ‘yellow vest’ demonstrations in France appear, at least in part, to be another example of the anti-globalisation sentiment that has emerged in a number of OECD countries. This column argues that the movement is also rooted in the country’s broken social elevator. Redistribution through taxes and social transfers is not sufficient to curb the inequality in opportunity, which is mostly linked to the educational system and perpetuates economic and social situations from one generation to the next.

Neil Cummins, 24 February 2019

Within countries, the driving force behind the 20th century’s dramatic drop in inequality were the declines in the wealth shares of the top 1%. Based on 60 million death and probate records covering a period of 100 years, this column argues that in the case of Britain the distributional gains from the Great Equalisation were exclusively confined to the top 30% of the wealth distribution. This left the nation’s social and political fabric vulnerable to the protest vote of many in 2016 to leave the EU, following the austerity induced by the financial crisis.

Sriram Balasubramanian, 17 February 2019

There has been considerable criticism of the general reliance on GDP as an indicator of growth and development. One strand of criticism focuses on the inability of GDP to capture the subjective well-being or happiness of a populace. This column examines new growth models, paying particular attention to Bhutan, which has pursued gross national happiness, rather than GDP, since the 1970s. It finds evidence of the Easterlin paradox in Bhutan, and draws out lessons for macroeconomic growth models. 

Matthias Helble, Trang Thu Le, Trinh Q. Long, 10 February 2019

The sudden rise in trade between China and the US – known as the ‘China shock’ – has been the subject of numerous studies, but the even more dramatic increase in trade between China and developing countries in Asia has been somewhat overlooked. This column studies the impact of the China shock on income inequality in Vietnam. It suggests that increased trade with China reduced income inequality. It resulted in income growth for the lowest income quantiles while higher income groups saw their income decline.

David Miles, 04 January 2019

If our wealth has been acquired unjustly in the past, does that injustice fade or persist? David Miles of Imperial College tells Tim Phillips how economics can help to answer this question.

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