Branko Milanović — My interview with Goldman Sachs magazine Fortnighly Thoughts: Populism or plutocracy?

It is important to begin with a clear definition of global income inequality. The most commonly accepted use of the term refers to inequality in what all the individuals in the world earn, regardless of the country of origin. This form of global inequality has been slightly decreasing over the past 15 years or so. What is driving this decline is that large and relatively poor countries, particularly China and India, have been growing significantly faster than the rich countries, like the US. There are, of course, other countries apart from China, India and the US that feed into global income inequality levels, but this triangular relationship explains close to 50% of the variation in the recent decades.

Another definition that is also used to describe income inequality paints a contradictory picture and refers to developments on an intra-country basis, rather than a global level. On these terms, over the last quarter-century, there has been an increase in inequality in a majority of nations including China, US, Russia, UK and most of Europe.

In summary, by and large there has been an increase in national inequality levels, but if we aggregate populations from all countries, global inequality has slightly declined.…

Global Inequality
My interview with Goldman Sachs magazine Fortnighly Thoughts: Populism or plutocracy?
Branko Milanović | visiting Professor at City University of New York Graduate Center and former lead economist at the World Bank’s research group, where he worked on the topics of income inequality and globalisation.