The State of Global Inequality

The United States is one of just a handful of high-income countries to have a high level of inequality, according to data published by the World Bank. It is joined by Chile, Panama and Uruguay.

The following map illustrates how income inequality varies around the globe. It uses the Gini index (or coefficient), which is a statistical measure that reflects the distribution of wealth (income, consumption, etc.) within a country. According to the World Bank's new report on Poverty and Shared Prosperity, high income inequality can "hinder poverty reduction, slow economic growth, limit access to economic and educational opportunities for individuals and reduce social cohesion within a country." However, reducing these inequalities can "promote the development of economic and human capital."

In total, 49 countries have a Gini index above 40, or high income inequality. As this chart shows, highly unequal economies are concentrated in Latin America and the Caribbean, as well as sub-Saharan Africa. More than 80 percent of countries in Latin America and the Caribbean have a Gini index above 40, with Colombia (55) and Brazil (52) the most unequal countries in the region. More than half of the countries in sub-Saharan are affected, while the greatest inequalities exist in southern Africa, with South Africa (Gini index of 63) and Namibia (59) the most unequal countries in the world.

The Gini coefficient is lowest in countries in Northern, Eastern and Central Europe. The lowest level of inequality in the world is measured in Slovakia, Slovenia and Belarus (Gini coefficient of 24), followed by countries such as the Netherlands, Iceland and the Czech Republic (index of 26). Currently, the majority of the current world population (5.6 billion, or 70 percent) lives in an economy where inequality is considered moderate, while a relatively small number (609 million, or 8 percent) live in economies where inequality is considered relatively low.

This chart and text was originally written by Tristan Gaudiaut found here.