List of Contents
What is the News?
World Inequality report 2022 has been released. The report is authored by Lucas Chancel, co-director of the World Inequality Lab and coordinated by famed French economist Thomas Piketty among others.
National Income: In India, the top 10% and top 1% hold respectively 57% and 22% of total national income. On the other hand, the bottom 50% share is just 13% in 2021.
Wealth Inequality: The inequality widens when it comes to wealth in India. The bottom 50% of the households own almost nothing. The middle class is also relatively poor owning 29.5% of the total wealth as compared with the top 10% and 1% who hold 65% and 33% of the total wealth respectively.
Gender Inequality: Gender inequalities in India are very high compared to the regional average. The female labour income share is equal to 18%, which is significantly lower than the 21% average in Asia.
Carbon Emitter: India is a low carbon emitter. The average per capita consumption of greenhouse gas is equal to just over 2 CO2e. These levels are typically comparable with carbon footprints in sub-Saharan African countries.
Private Wealth: There has been a rise of private wealth in emerging countries such as China and India. China has had the largest increase in private wealth in recent decades. The private wealth increase seen in India over this time is also remarkable (up from 290% in 1980 to 560% in 2020).
What is the significance of these findings for India?
India stands out as a poor and very unequal country with an affluent elite.
After independence, socialist-inspired five-year plans contributed to reducing inequality to 35-40%.
However, since the mid-1980s, deregulation and liberalization policies adopted by India have mostly benefited the top one percent.
What are the findings globally?
The richest 10% of the global population currently takes 52% of global income whereas the poorest half of the population earns 8% of it.
Global wealth inequalities are even more pronounced than income inequalities. The poorest half of the global population barely owns any wealth at all, possessing just 2% of the total. In contrast, the richest 10% of the global population own 76% of all wealth. In fact, 2020 marked the steepest increase in global billionaires share of wealth on record.
The Middle East and North Africa (MENA) are the most unequal regions in the world, whereas Europe has the lowest inequality levels.
The report also notes that inequalities within countries are now greater than those observed between countries.
What are the suggestions given by the report?
The report has suggested levying a modest progressive wealth tax on multimillionaires. If progressive wealth tax is levied, around 1.6% of global incomes could be generated and reinvested in education, health and the ecological transition.
Source: This post is based on the following articles:
- “World’s most extreme inequality increase in India” published in Down To Earth on 8th December 2021.
- “India ‘very unequal’, top 10% hold 57% of national income: Inequality Report” published in Indian Express on 8th December 2021.
- “India ‘poor and very unequal’ with affluent elite: Inequality Report” published in Business Standard on 8th December 2021.