*Since the turn of the century, income inequality has risen to be among the most prominent policy issues of our time. This column looks at inequality trends in recent decades. While relative global inequality has fallen, insufficient economic convergence, together with substantial growth in per capita incomes, has resulted in increased absolute inequality since the mid-1970s. The inclusivity aspect of growth is now more imperative than ever.*

*Watch Finn Tarp and Miguel Niño-Zarazúa discuss the trends in global inequality in the video below:*

**Figure 1. Trends in global inequality from a relative and absolute perspective**

**‘Relative’ versus ‘absolute’ inequality**

**What has happened across world regions?**

**Figure 2. Regional relative and absolute inequality**

**Could the increased absolute global inequality have been prevented while achieving the same rates of economic growth observed in the past 40 years?**

*insufficient*economic convergence, together with substantial growth in per capita incomes, has meant that the increased absolute differences in average incomes between countries have resulted in increased absolute global inequality. Could this increased absolute inequality have been avoided, while maintaining the same economic growth that has lifted many millions of people in poorer countries out of poverty?

*This article is reproduced by permission of UNU-WIDER, which commissioned the original research and holds copyright thereon.*

**Further Reading**

- Alesina, Alberto and Roberto Perotti (1996), "Income distribution, political instability, and investment",
*European Economic Review*, 40(6):1203-1228. Available here. - Amiel, Yoram and Frank A Cowell (1992), "Measurement of income inequality", J
*ournal of Public Economics*, 47(1):3-26. Available here. - Amiel, Y and FA Cowell (1999),
*Thinking about inequality: Personal judgment and income distributions*, Cambridge University Press. Available here. - Jong-sung, You and Sanjeev Khagram (2005), "A comparative study of inequality and corruption",
*American Sociological Review*, 70(1):136-157. Available here. - Kelly, Morgan (2000), "Inequality and crime",
*Review of Economics and Statistics*, 82(4):530-539. Available here. - Niño-Zarazúa, Miguel, Laurence Roope and Finn Tarp (2016), "Global inequality: Relatively lower, absolutely higher",
*Review of Income and Wealth*. Available here. - Ravallion, Martin (2001), "Growth, inequality and poverty: Looking beyond averages",
*World Development*, 29(11):1803-1815. - Roope, L (2015), ‘Critical percentiles for equalizing growth’, Centre for the Study of African Economies (CSAE) Working Paper, University of Oxford.