GRIPPING GRAPH Unhappy valley
Princeton University economics professor Paul Krugman has claimed this to be his chart of the year. It shows global income growth since 1988 by percentiles of global income distribution, revealing that incomes have soared at the top end as the world’s elite has become ever richer.
There have also been huge gains for the global middle, mainly the rising middle classes of China and India, he explains in his blog.
But between these “twin peaks” — the ever-richer global elite and the rising emerging market middle class — lies what Krugman dubs “the valley of despond”. It shows incomes have grown slowly, if at all, for people around the 20th percentile of the world income distribution — the US lower-middle class or advanced-country working classes in general. Krugman blames this on competition from emerging market exports, government austerity, and policies that favour the elite — a recipe he fears is unsustainable. Claire Bisseker