Inequality Current Affairs - 2019
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United Nations Development Programme (UNDP) which publishes the Human Development Report (HDR), will release the HDR 2019 with its focus on inequality. The report would be released around the last quarter of the year.
HDR 2019 and Inequality
- HDR 2019 will provide a comprehensive picture of the many forms of inequality that are shaping the 21st century.
- The report will use a framework that looks beyond income and considers inequalities in health, education, tech and exposure to economic and climate-related shock and will look beyond averages to paint a more accurate and timely picture of the state of inequality.
- HDR 2019 will also seek to look beyond today by taking a long-term view of inequality and by identifying trends and making projections.
UNDP has acknowledged that today’s world remains deeply unfair. The life and prospects faced by a newborn in a poor country or in a poor household are radically different from those of wealthier children. In all societies, long-standing forms of inequality persist while gaps are opening in new aspects of life.
The world is witnessing both convergence and divergence in human development. For example, in many countries gaps have closed for example in access to primary education. But differences between children in poor and wealthy households are widening in both early childhood and quality of education. These inequalities will have lifetime consequences, especially due to the rapid technological changes which are likely to impact labour markets. This is just one example of why UNDP’s analysis of inequality will go beyond income, beyond averages and beyond today in HDR 2019.
According to World Inequality Report 2018, Income inequality in India has reached historically high levels with share of national income accruing to India’s top 1% earners touching 22% in 2014, while share of top 10% was around 56%. The report was released by World Inequality Lab (WIL), an organisation that aims to promote research on global inequality dynamics.
Findings of report
Since 1980, richest 1% captured twice as much as poorest 50% of world population. In other words, since 1980, 27% of all new income worldwide was captured by richest 1%, while poorest 50% captured only 13% of growth.
Inequality trends vary so greatly among countries even when countries share similar levels of development. This highlights important role of national policies in shaping inequality. For instance since 1980, China has recorded much higher growth rates with significantly lower inequality levels than India.
Since 1980, income inequality has increased rapidly in North America, India, China and Russia while growing moderately in Europe. However, in sub-Saharan Africa, Middle East, Brazil income inequality has remained relatively stable but at extremely high levels.
Factors fuelling the inequality within countries and at global level include combination of privatisations and increasing income inequality. Private capital is increasingly concentrated among a few individuals.
Deregulation and opening-up of reforms in India since 1980s have led to substantial increase in inequality. In 2014, top 0.1% of earners have continued to capture more growth than all those in bottom 50% combined in India.
The bottom 50% now has about 15% share in the total income. This rising inequality contrasts to 30 years following country’s Independence in 1947, when income inequality was widely reduced and incomes of bottom 50% grew at faster rate than national average.
The global income and wealth inequality will steadily rise if countries continue to follow same trajectory they have been on since 1980, despite strong growth in emerging countries. There is need for more ambitious policies to democratize access to education and well-paying jobs in rich and emerging countries alike.