1. Global Inequality
A lecture by Dr Christopher Kollmeyer

2. Lecture Outline Lecture Addresses Three Questions:
What’s the extent of global inequality today? (answer: massive)
What’s the trend in global inequality?
Within countries (answer: becoming more unequal)
Between countries (answer: debatable)
What are the dominant explanations?
Modernization (neoliberal) theory
Dependency (world-systems) theory
Question 3:
Modernization and neoliberal Theories
Emphasize the short-comngs of poor countries
Inefficiency
Disincentives toward investment and growth
Corruption
2. World-System and Dependency Theories
Emphasize interconnections with global economy and the use of political power by rich countries
Legacy of colonialism and inherent inequalities in capitalism
North and South Elites vs. South Workers
Lack of Democracy

3. The Champagne Glass of Inequality: Share of Global Income by Quintiles
Bottom 60 percentile have less than 6% of the world’s income.

4. World’s Top-Ten Billionaires, 2007
Note: Scotland’s GDP equals about £80 billion per year.

5. Global Poverty
The World Bank estimates that 1.3 billion people live on less than 50p per day ($1)

6. Living standard of the global poor

8. Life Expectancy and Income

9. Between-Country Inequality: The Global Distribution of Income and Population78 16 6 60 25 15
3 Categories of Countries
High Income: USA, EU, Japan
Middle Income: Argentina, Brazil, Turkey, Russia
Low Income: Sub-saharan Africa, SouthEast Asia, Afghanistan, Pakistan
N = number of countries
Blue = Population
Red = Wealth
No inequality = blue and red same size

10. Geography of Global Inequality
Key
Dark Blue = Wealthy Countries
Light Blue = Middle Income Countries
Pink and Red = Poor Countries
Show the rich Areas
Show the Poor Areas
Wealthiest: Western European countries, British Off-Shoots, and Japan
Poorest: Sub-Saharan African and South Asian countries

11. The North-South Divide
This picture of the Earth at night shows the wealthy Global North, illuminating its communities at night, and the much poorer Global South, which can’t afford to do so.

12. Within-Country Inequality: Income share of richest 20th percentile to poorest 20th percentile.

13. What are the recent trends in global income inequality?
Question 2:
What are the recent trends in global income inequality?
Within countries: Becoming more unequal in most countries
Between countries: Becoming more unequal, except for China and other countries in East Asia, which are catch up with the West.
Within Countries:
Going Up (but varies)

14. Example of Within-Country Income Inequality: The United States, 1913-2002
Source:Thomas Piketty and Emmuanuel Saez “Income Inequality in the United States, ” Quarterly Journal of Economics.

15. Inequality rising in most Anglo-Celtic countries, but remaining steady in most Continental European countries
Emmanuel Saez Income and Wealth Concentration in a Historical and International Perspective. National Bureau of Economic Research, USA.

16. Changes in Between-Country Income Inequality, 1950-2000
Begin of decline
Begin of China’s economic rise
Source: Sutcliffe, B “World Inequality and Globalization.” Oxford Review of Economic Policy, Vol 20, No. 1

17. Absolute vs Relative Inequality A Hypothetical Example
Country A £1,000 £2,000
Country B £15,000 £30,000
Absolute Income Gap £14,000 £28,000
Relative Inequality 15:1 15:1

18. Global Poverty Declines:
World population living off less than US$1 per day by region
S-S Africa
South Asia
East Asia
Source: World Bank 2007
Note: Measured in constant 1993 US$ adjusted for PPP. Equals approx: 73p in today’s GBP