How Unequal Is Europe? Evidence From Distributional National Accounts, 1980-2017

WID.world Working Paper 2019/6, April 2019
with Thomas Blanchet and Lucas Chancel
PDF-button3.png

This paper estimates the evolution of income inequality in 38 European countries from 1980 to 2017 by combining surveys, tax data and national accounts. We develop a harmonized methodology in order to produce homogeneous income inequality estimates, comparable across countries and consistent with official national income growth rates. Inequalities have increased in a majority of European countries, especially between 1980 and 2000. The European top 1% grew more than two times faster than the bottom 50% and captured 17% of regional income growth. Relative poverty in Europe went through ups and downs, increasing from 20% in 1980 to 22% in 2017. Inequalities yet remain lower and have increased much less in Europe than in the US, despite the persistence of strong income differences between European countries and the weaker progressivity of European-wide income redistribution.

Media coverage: Le Monde, France 24, VoxEU.

2019_04_WID_Europe.PNG

Growing Cleavages in India? Evidence from the Changing Structure of Electorates

Economic and Political Weekly, 54(11), pp. 34-44, March 2019
with Abhijit Banerjee and Thomas Piketty
PDF-button3.png
2019_03_India.PNG

This paper combines surveys, election results and social spending data to document a long-run evolution of political cleavages in India. The transition from a dominant-party system to a fragmented system characterised by several smaller regionalist parties and, more recently, the Bharatiya Janata Party, coincides with the rise of religious divisions and the persistence of strong caste-based cleavages, while education, income and occupation play a diminishing role (controlling for caste) in determining voters’ choices. More importantly, there is no evidence of the new party system being associated with changes in social policy, which corroborates the fact that in India, as in many Western democracies, political conflicts are increasingly focused on identity and religious–ethnic conflicts rather than on tangible material benefits and class-based redistribution.

Media coverage: Economic Times

Extreme Inequality, Democratisation and Class Struggles in Thailand

WID.world Issue Brief 2019-1
with Thanasak Jenmana
PDF-button3.png
thai-ineq-3.PNG

Thailand is finally set to have a general election on 24 March 2019 after five years of military government and a long period of political uncertainty. In this note, we argue that a main source of political instability is brought by Thailand’s extreme levels of income, wealth and regional inequalities, as well as by the rising politicisation of class conflicts around redistributive issues which followed the Asian Financial Crisis. The post-1997 party politics successfully put an end to a long period of rising income disparities, but Thailand remains one of the most unequal societies in the world today. Most importantly, class cleavages can be seen in voting behaviours and party identification, but not so in terms of preference for democracy and political ideologies.

Media coverage: Bangkok Post.

PDF-button3.png
Brazil_vote_income.PNG

The political polarisation surrounding the 2018 Brazilian presidential election can be associated to class cleavages linked to the Workers’ Party’s policies in directly improving the living conditions of the poor, and indirectly benefiting elites, largely to the neglect of the middle class. The poorest 50% in the income distribution have been increasingly more likely to vote for the PT and other left-of-centre parties since 2002 compared to the richest 10%. This striking evolution occurred in a context of strong income growth for the bottom deciles (almost twice the national average), compared to the lower-than average growth for the upper-middle class. The Bolsonaro vote has gathered those who are disappointed with the political system’s corruption and complacency for security issues, as well as those who are appeased by the candidate’s liberal economic program.

Media coverage: Valor Econômico, The Brazilian Report.