Policy plea after rich gap revealed

TOKYO — Global income inequality has worsened over the past four decades, a report has found, with the wealthiest 1 percent of the world’s population capturing twice as much income growth as the bottom half.

The world’s middle class, made up mostly of people in North America and Europe, has by some measures fared the worst. Globalization has boosted incomes for hundreds of millions of people in developing countries, particularly China and India. And it has lowered pay for manufacturing workers and other middleincome employees in the developed world.

The World Inequality Report 2018 is based on an interactive collection of data compiled by an international team of researchers that includes renowned economists Thomas Piketty and Emmanuel Saez.

Their previous research drew attention to widening inequality in the United States by highlighting the disproportionate income gains enjoyed by the richest 1 percent since 1980.

The new report argues that countries can reduce inequality through more progressive taxation and by subsidizing education. It points out that the US and Western Europe had similar levels of inequality in 1980, with the top 1 percent holding about 10 percent of income. But by 2016, the top 1 percent in Europe held a 12 percent income share, compared with 20 percent in the US.

The report shows that income gaps soared after 1980, though they leveled off after 2008 after the financial crisis. The richest 1 percent of the world’s population saw its share of global income slip from about 22 percent in 2008 to just above 20 percent in 2016.

At the same time, the share of global income going to the bottom 50 percent rose slightly in the same period, to just under 10 percent, thanks to gains in fast-growing China and India.

One of the goals of the study was to push governments to be more transparent about financial data to ensure that debates over inequality and the policies that affect incomes and wealth are wellinformed.

“Economic inequality is widespread and to some extent inevitable,” they said in the report’s summary. “It is our belief, however, that if rising inequality is not properly monitored and addressed it can lead to various sorts of political, economic and social catastrophes.”