Reduced inequalities

Reduced Inequalities

By: Muhammad Adnan Ejaz

Outline

Definition

Types

Inequality in the Headlines

Some Facts and Figures

How to reduce Inequality

Definition

Social inequality is the existence of unequal opportunities and rewards for different social positions or statuses within a group or society.

Inequality is the Problem: What’s Our Response?

Types

Social Inequalities:

Political Inequality

Income and wealth inequality

Inequality of opportunity

Treatment and responsibility

Inequality of membership

Some other types:

Gender inequality

Racial and Ethnic inequality

Age Inequality

Inequalities in Health

Types (some other types…)

Between individuals (Global)

Between Countries

Within Countries

Inequality in the Headlines

Facts and Figures

On average—and taking into account population size—income inequality increased by 11 per cent in developing countries between 1990 and 2010

A significant majority of households in developing countries—more than 75 per cent of the population—are living today in societies where income is more unequally distributed than it was in the 1990s

Evidence shows that, beyond a certain threshold, inequality harms growth and poverty reduction, the quality of relations in the public and political spheres and individuals’ sense of fulfilment and self-worth

There is nothing inevitable about growing income inequality; several countries have managed to contain or reduce income inequality while achieving strong growth performance

In a global survey conducted by UN Development Programme, policy makers from around the world acknowledged that inequality in their countries is generally high and potentially a threat to long-term social and economic development

Evidence from developing countries shows that children in the poorest 20 per cent of the populations are still up to three times more likely to die before their fifth birthday than children in the richest quintiles

Despite overall declines in maternal mortality in the majority of developing countries, women in rural areas are still up to three times more likely to die while giving birth than women living in urban centres

Global poverty concentrated in few countries

• 80% live in rural areas

• 2/3 work in agriculture

• Half are children

• Most have little or no

formal education

• Yet, regional differences

How To Reduce Inequality?

We know much about the sources of inequality by economic, race/ethnic, &

immigrant origins

Ways to reduce inequality are less well understood

We support research on programs, policies, and practices that reduce

inequality in youth outcomes

Academic, social, behavioral, and economic outcomes

Fighting poverty is an important part of reducing inequality, but not all there

is to it

We’d like to reduce inequality across the spectrum

One can “reduce inequality” by elevating those lower down or holding back

those who are on top

Only the former is of interest

How To Reduce Inequality?

“Inequality” has two meanings

Overall dispersion of an outcome

Group differences in an outcome

We’d like to reduce the first and eliminate the second

How to reduce inequality? Country perspective: common elements

Lessons from country case studies reducing inequality, poverty, and strong SP premium and growth: Brazil, Cambodia, Mali, Peru, Tanzania

a. Context can vary: NO EXCUSE FOR NOT TACKLING INEQUALITY Inequality can be reduced in countries at different stages of development, pursuing different economic strategies, facing wide-ranging circumstances

b. But some factors are common to all: GOOD POLICY CHOICES Prudent macroeconomic management, ability to deal with

external shocks, and protracted and coherent economic and social policies;

Translate economic growth into inequality reduction through labor markets (increasing job opportunities, reducing income gaps)

How to reduce inequality? Country perspective: sustaining success

c. Favorable external conditions help: cheap and abundant credit, booming trade, high commodity prices plus favorable weather conditions

d. But good luck is short lived and success under fire recently: by unsound fiscal decisions (Brazil); conflict (Mali), low productivity (Peru); unfinished reforms (Tanzania)

How to reduce inequality? Policy perspective

Report focuses on six policy areas(with good evidence, significant impacts, and little

equity-efficiency tradeoff)

early childhood development and nutritionuniversal health care

quality education conditional cash transfers

rural infrastructure investmentstaxation

And some very simple lessons:Raise productivity of the poor:

Invest in children (ECD and quality education)Invest in health (universal health care)

Invest in Infrastructure (rural roads, electrification)

Make money work for the poor (CTs and progressive taxation)

ARE THESE REDUCTIONS OF INEQUALITY ENOUGH TO END

POVERTY BY 2030 IF GLOBAL GROWTH

CONTINUES SUBDUED?

SIMULATING POVERTY BY 2030 UNDER INEQUALITY SCENARIOS AND CURRENT GLOBAL GROWTH

TO END EXTREME POVERTY

BY 2030, WE HAVE TO

REDUCE INCOME INEQUALITY

AT A FASTER PACE