Income inequality is rising in most OECD countries

According to a new Organisation for Economic Co-operation and Development report, Growing Unequal? Income Distribution and Poverty in OECD Countries, a combination of globalization, economic growth, and other societal changes has not only led to a larger gap between rich and poor nations; it’s also led to a growing gap between rich and poor in more than three-quarters of OECD countries over the past two decades.

Of the OECD countries, except for Mexico and Turkey, the United States has highest inequality level and poverty rate. Since 2000, income inequality has increased rapidly, accentuating a long-term trend that began in the 1970s.

OECD’s Growing Unequal? finds that the economic growth of recent decades has benefitted the rich more than the poor. In some countries, such as Canada, Finland, Germany, Italy, Norway and the United States, the gap also increased between the rich and the middle-class.

Countries with a wide distribution of income tend to have more widespread income poverty. Also, social mobility is lower in countries with high inequality, such as Italy, the United Kingdom and the United States, and higher in the Nordic countries where income is distributed more evenly.

Launching the report in Paris, OECD Secretary-General Angel Gurría warned of the dangers posed by inequality and the need for governments to tackle it. “Growing inequality is divisive. It polarises societies, it divides regions within countries, and it carves up the world between rich and poor. Greater income inequality stifles upward mobility between generations, making it harder for talented and hard-working people to get the rewards they deserve. Ignoring increasing inequality is not an option.”

via Income inequality and poverty rising in most OECD countries

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