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Different Dimensions of Inequality

Praveen Jha

Edited by Pranab Bardhan, Samuel Bowles and Michael Wallerstein
Oxford University Press, New Delhi, 2009, pp. xii 326, Rs. 595.00


The relationship between globalization and redistribution has been a major bone of contention in debates on globalization. The more enthusiastic advocates of globalization view global economic integration as a welcome high tide that will lift all the boats and bring significant economic gains to everyone across the globe; on the other hand, the critics argue that large sections of the global population have been harmed a great deal, economically and otherwise, and inequalities have been exacerbated as a consequence of ongoing globalization. Of course, the relationship between globalization and egalitarian distribution has several aspects e.g. equity or otherwise between nations which may show a different trajectory compared to distributional outcomes within nations across, for instance, deciles of population, which in turn may be different from distributional trends across social and economic categories. Furthermore, both for conceptual as well as operational reasons, which particular variable (for instance, assets, income or consumption) ought to be given priority remains a controversial subject. Yet other tricky considerations involve separating and measuring the impact of ‘globalization’ per se as distinct from other significant economic and socio-political factors. There is, as one may expect, a growing literature on these and related issues and it may be fair to say that there are few unequivocal answers to most of the questions. Nonetheless, it may not be off the mark to suggest that the most commonly used indicator of equality (i.e. income equality) has worsened during the current phase of globalization, and the gap between the two ends of the pole has tended to increase significantly. For instance, as per a well-known study by Milanovic (2007) the ratio of GDP per capita between the twenty richest and the twenty poorest countries rose from 54:1 during 1960-62 to 121:1 during 2000-2002. Sure enough, there is a handful of developing countries which have reduced the gap vis-à-vis the developed countries, the trend for most developing countries has been in the opposite direction.   As regards trends in income inequalities within countries, it may be difficult to find exceptions to the rule of growing inequalities almost everywhere. Deregulation premised on the magic of the market, lower taxes on high incomes, increasing integration of product markets as well as capital/finance markets across the globe and a host of other reasons organically connected with the economics of globalization have resulted in rapidly widening gap between the income of the profit earners/rentiers/managers ...

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