Growing Unequal? Income Distribution and Poverty in OECD Countries

The gap between rich and poor has grown in more than three-quarters of OECD countries over the past two decades, according to a new OECD report.

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.

Comment: I suspect that the gap will widen still more in the next couple of years, since it seems to me that the economic hard times are going to hit the poor more than the rich, and those unable to protect themselves more than those who have the education, resources, and contacts to ride out the troubles.

Of course, this report of the OECD does not address the poverty gap between rich and poor countries, which is complicated. However, there are many poor countries that have advanced little since 1978, while the richest countries have progressed, with the spread of country GDPs expanding. JAD