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The Globalization of Inequality
In "The Globalization of Inequality," distinguished economist and policymaker Francois Bourguignon examines the complex and paradoxical links between a vibrant world economy that has raised the living standard of over half a billion people in emerging nations such as China, India, and Brazil, and the exponentially increasing inequality within countries. Exploring globalization's role in the evolution of inequality, Bourguignon takes an original and truly international approach to the decrease in inequality "between" nations, the increase in inequality "within "nations, and the policies that might moderate inequality's negative effects.
Demonstrating that in a globalized world it becomes harder to separate out the factors leading to domestic or international inequality, Bourguignon examines each trend through a variety of sources, and looks at how these inequalities sometimes balance each other out or reinforce one another. Factoring in the most recent economic crisis, Bourguignon investigates why inequality in some countries has dropped back to levels that have not existed for several decades, and he asks if these should be considered in the context of globalization or if they are in fact specific to individual nations. Ultimately, Bourguignon argues that it will be up to countries in the developed and developing world to implement better policies, even though globalization limits the scope for some potential redistributive instruments.
An informed and original contribution to the current debates about inequality, this book will be essential reading for anyone who is interested in the future of the world economy.
"
224 pages, Hardcover
First published August 1, 2012
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June 15, 2015
By Edward Hadas
Move over, Thomas Piketty. Anyone who has been put off by the French economist’s overblown and overly long book on inequality now has a succinct alternative, “The Globalization of Inequality”. In a mere 189 pages, François Bourguignon provides a measured introduction to what is right and what is wrong about current trends in the dispersion of incomes.
Like Piketty, Bourguignon is French, and he is emeritus chair at the Paris School of Economics, where Piketty teaches. They are both big names in the small world of inequality economics. Where Piketty is full of grand theories, however, his elder colleague is healthily cautious.
“Globalization” explores a paradox. On the positive side, global inequality has decreased sharply since about 1990, thanks largely to the great rise of China accompanied by lesser gains in most developing economies. On the negative side, inequality within many countries, both rich and enriching, has increased.
That sounds simple and clear, but Bourguignon deftly presents some serious qualifications to both claims. The global good news is marred by the persistence of severe poverty, especially in sub-Saharan Africa. Also, while the overall trend is positive, the gap between developed and emerging economies remains very wide. And there are good reasons to fear that the catch-up of many populous poorer countries is slowing.
As for inequality within nations, there are many exceptions to the increasing trend. France is one rich country in the mix and many Latin American nations among the poorer ones. Bourguignon also points out that popular perceptions do not correspond with typical measurements. Most Americans, for example, believe that inequality has not increased over the last decade. He speculates about the reasons for the discrepancy, but misses one possible explanation: perhaps cash measures of income are poor proxies for actual consumption and economic standing.
Bourguignon is sceptical, and with good reason, of the standard economic theory that there is always a trade-off between an efficient economy and a just one. He reviews ways in which greater equality can accelerate GDP growth, and dedicates several pages to explaining why increased inequality might be a significant cause of the 2008 collapse in the U.S. housing market.
Like most inequality economists, Bourguignon believes greater equality is generally desirable. He argues that a fight against rising inequality is justified in rich countries “from the point of view of social justice”. More pragmatically, he claims this fight is “an essential safeguard for preserving societal stability and economic performance”.
Bourguignon the scholar, however, is less certain than Bourguignon the campaigner. “We must admit that it is extremely difficult to demonstrate empirically the consequences of excessive levels of inequality …” The possible dire effects of inequality are not the only area where the data fall short. Indeed, such words as unclear, uncertain and complex keep turning up.
What sort of inequality – of income, wealth or opportunity – is most significant? What measures of inequality are most informative? How do changing household structures influence real inequality? Why has inequality increased more in some countries than others? What are the best ways to reduce inequality, whether among or within nations? Bourguignon explains that not enough is known to provide definitive answers to any of these questions.
Bourguignon is particularly sketchy when it comes to the largest question raised by his admirably global book. How much attention does the rise in inequality in rich countries deserve? Piketty uses dubious theories to justify his focus. Considering the great global gap, however, furious national campaigns against in-country inequality may seem narrowly parochial. The energy might be better dedicated to finding ways to help the world’s poorest residents.
Perhaps that debate is best left for philosophers. For anyone else interested in the economics of inequality, this book is a good place to start.
Move over, Thomas Piketty. Anyone who has been put off by the French economist’s overblown and overly long book on inequality now has a succinct alternative, “The Globalization of Inequality”. In a mere 189 pages, François Bourguignon provides a measured introduction to what is right and what is wrong about current trends in the dispersion of incomes.
Like Piketty, Bourguignon is French, and he is emeritus chair at the Paris School of Economics, where Piketty teaches. They are both big names in the small world of inequality economics. Where Piketty is full of grand theories, however, his elder colleague is healthily cautious.
“Globalization” explores a paradox. On the positive side, global inequality has decreased sharply since about 1990, thanks largely to the great rise of China accompanied by lesser gains in most developing economies. On the negative side, inequality within many countries, both rich and enriching, has increased.
That sounds simple and clear, but Bourguignon deftly presents some serious qualifications to both claims. The global good news is marred by the persistence of severe poverty, especially in sub-Saharan Africa. Also, while the overall trend is positive, the gap between developed and emerging economies remains very wide. And there are good reasons to fear that the catch-up of many populous poorer countries is slowing.
As for inequality within nations, there are many exceptions to the increasing trend. France is one rich country in the mix and many Latin American nations among the poorer ones. Bourguignon also points out that popular perceptions do not correspond with typical measurements. Most Americans, for example, believe that inequality has not increased over the last decade. He speculates about the reasons for the discrepancy, but misses one possible explanation: perhaps cash measures of income are poor proxies for actual consumption and economic standing.
Bourguignon is sceptical, and with good reason, of the standard economic theory that there is always a trade-off between an efficient economy and a just one. He reviews ways in which greater equality can accelerate GDP growth, and dedicates several pages to explaining why increased inequality might be a significant cause of the 2008 collapse in the U.S. housing market.
Like most inequality economists, Bourguignon believes greater equality is generally desirable. He argues that a fight against rising inequality is justified in rich countries “from the point of view of social justice”. More pragmatically, he claims this fight is “an essential safeguard for preserving societal stability and economic performance”.
Bourguignon the scholar, however, is less certain than Bourguignon the campaigner. “We must admit that it is extremely difficult to demonstrate empirically the consequences of excessive levels of inequality …” The possible dire effects of inequality are not the only area where the data fall short. Indeed, such words as unclear, uncertain and complex keep turning up.
What sort of inequality – of income, wealth or opportunity – is most significant? What measures of inequality are most informative? How do changing household structures influence real inequality? Why has inequality increased more in some countries than others? What are the best ways to reduce inequality, whether among or within nations? Bourguignon explains that not enough is known to provide definitive answers to any of these questions.
Bourguignon is particularly sketchy when it comes to the largest question raised by his admirably global book. How much attention does the rise in inequality in rich countries deserve? Piketty uses dubious theories to justify his focus. Considering the great global gap, however, furious national campaigns against in-country inequality may seem narrowly parochial. The energy might be better dedicated to finding ways to help the world’s poorest residents.
Perhaps that debate is best left for philosophers. For anyone else interested in the economics of inequality, this book is a good place to start.
June 21, 2015
There have been a number of recent publications on the topic of inequality and this short work from former World Bank Chief Economist Francois Bourguignon is a worthwhile addition to the bookshelf.
The starting point for the book is the argument that while income inequality between countries is reducing, there is an increasing trend towards greater inequality within countries. With regard to reductions between countries the importance of globalization the movement of factors of production to developing countries after WW2 is well understood and documented. However, simultaneously the historical inequality within countries has risen over the last 20 years due to intensified competition which has accelerated the pace of technological innovation, induced financial liberalization and encouraged a mobility of the factors of production. The second cause of in-country inequality is economic policies which favor efficiency and the competitiveness of markets over inequality and the effects of disequilibrium caused by globalization.
Bourguignon is clear that there are complex and contrary forces in the relationship between inequality and economic efficiency. Policy makers need to address issues of incentives in adjusting taxes and transfers as well as providing a level playing field for opportunity to reduce inequality and gains in efficiency for the economy as a whole.
The book is a quick and relatively easy read for the layman although the start of the book does dwell on methodology which might have been better included as an annex. The analytical content is also stronger than the policy implications which are short, perhaps in keeping with the nature of the text.
All in all a well worth text which I will look forward to comparing with the recent Stiglitz and Atkinson texts on inequality.
The starting point for the book is the argument that while income inequality between countries is reducing, there is an increasing trend towards greater inequality within countries. With regard to reductions between countries the importance of globalization the movement of factors of production to developing countries after WW2 is well understood and documented. However, simultaneously the historical inequality within countries has risen over the last 20 years due to intensified competition which has accelerated the pace of technological innovation, induced financial liberalization and encouraged a mobility of the factors of production. The second cause of in-country inequality is economic policies which favor efficiency and the competitiveness of markets over inequality and the effects of disequilibrium caused by globalization.
Bourguignon is clear that there are complex and contrary forces in the relationship between inequality and economic efficiency. Policy makers need to address issues of incentives in adjusting taxes and transfers as well as providing a level playing field for opportunity to reduce inequality and gains in efficiency for the economy as a whole.
The book is a quick and relatively easy read for the layman although the start of the book does dwell on methodology which might have been better included as an annex. The analytical content is also stronger than the policy implications which are short, perhaps in keeping with the nature of the text.
All in all a well worth text which I will look forward to comparing with the recent Stiglitz and Atkinson texts on inequality.
June 19, 2015
Links between a developing world economy and individual poverty and inequality are examined in this fairly academic book, seeking to make sense of the growing inequality that can exist within nations, even when the world is seeing an increase in overall living standards, especially within the developing world.
The author believes that there is no simple way of isolating the factors that stand behind the change in fortune and inequality, yet notes that often these inequalities sometimes balance each other out or reinforce one another.
This is an interesting, serious subject to consider, even if the typical reader will be powerless to effect change, yet the text feels at times quite stilted and difficult to parse, even for an academically focussed work. This book was originally published in French and maybe the translation needs a little more polishing and editing. The publisher notes that the English version has been expanded upon from its original publication, adding new and updated information whilst keeping to the original’s non-technical, concise nature.
It is pleasing that the publisher has chosen to release this book with a modest price tag, meaning that it can be accessible to the regular, interested reader as well as to those who have a professional or academic interest. Certainly there is a fine line between readability and dumbing down a serious, comprehensive work and it feels overall that the author and publisher has managed to meet this challenge well. This is not a “sexy” subject that will see this book necessarily topping book bestseller charts, yet for those who care about the subject it can be an important, possibly essential read that contributes much to the debate and changing worldview.
The Globalization of Inequality, written by François Bourguignon and published by Princeton University Press. ISBN 9780691160528, 224 pages. YYYY
http://syndicate.darreningram.com/the...
The author believes that there is no simple way of isolating the factors that stand behind the change in fortune and inequality, yet notes that often these inequalities sometimes balance each other out or reinforce one another.
This is an interesting, serious subject to consider, even if the typical reader will be powerless to effect change, yet the text feels at times quite stilted and difficult to parse, even for an academically focussed work. This book was originally published in French and maybe the translation needs a little more polishing and editing. The publisher notes that the English version has been expanded upon from its original publication, adding new and updated information whilst keeping to the original’s non-technical, concise nature.
It is pleasing that the publisher has chosen to release this book with a modest price tag, meaning that it can be accessible to the regular, interested reader as well as to those who have a professional or academic interest. Certainly there is a fine line between readability and dumbing down a serious, comprehensive work and it feels overall that the author and publisher has managed to meet this challenge well. This is not a “sexy” subject that will see this book necessarily topping book bestseller charts, yet for those who care about the subject it can be an important, possibly essential read that contributes much to the debate and changing worldview.
The Globalization of Inequality, written by François Bourguignon and published by Princeton University Press. ISBN 9780691160528, 224 pages. YYYY
http://syndicate.darreningram.com/the...
September 23, 2019
I know this is more looking at our current economy, but how on earth does one write a book about globalization and how to lessen the gap between developed and developing countries without acknowledging how these “developed” countries destroyed the other countries through colonialism and imperialism? You can’t look at struggling economies in countries and give ways to fix them without talking about reparations or the fact that there’s probably not any way to fix an economy when you’ve stripped all the resources from the land, etc. Historical context is crucial because it informs us of what will happen, or how to make sure something doesn’t happen again, and yikes I can’t believe it wasn’t included.
Also the issues or racism, etc, relate to inequality is way more complex and deserves more attention than the space it was given. (And while you maybe can have an efficient economy that is equal, I doubt you can have a capitalistic economy that is equal. That’s the problem also - when you look at globalization and economic disparity between countries and its people, you at least have to acknowledge that you can’t lessen the gap while countries and the world operates on capitalism, because capitalism is getting success at the expense of another - and it’s a big reason why economic gaps are getting worse (like how companies want people to work for less than nothing, or how PoC are never given as much money))
Also the issues or racism, etc, relate to inequality is way more complex and deserves more attention than the space it was given. (And while you maybe can have an efficient economy that is equal, I doubt you can have a capitalistic economy that is equal. That’s the problem also - when you look at globalization and economic disparity between countries and its people, you at least have to acknowledge that you can’t lessen the gap while countries and the world operates on capitalism, because capitalism is getting success at the expense of another - and it’s a big reason why economic gaps are getting worse (like how companies want people to work for less than nothing, or how PoC are never given as much money))
February 12, 2016
The stated goal of this book is to present complex issues around the topic of globalization and inequality in an accessible, non-technical way, so that as wide a readership as possible can have an understanding of the ideas at play. While I really enjoyed Bourguignon's book, I feel that it didn't quite live up to its goal--the technical analysis was sometimes a little shallow, despite the fact that the writing style was not always easy to digest.
Bourguignon's greatest strength is in presenting a wide range of ideas without any heavy biases, and being transparent about where (as is often the case in economics) the evidence is inconclusive. While this book wouldn't serve as the best introduction to the topic, I found it to be a thorough and engaging overview of many of the issues that our rapidly globalizing world faces, and am excited to read some of the other books and papers cited by the author.
Bourguignon's greatest strength is in presenting a wide range of ideas without any heavy biases, and being transparent about where (as is often the case in economics) the evidence is inconclusive. While this book wouldn't serve as the best introduction to the topic, I found it to be a thorough and engaging overview of many of the issues that our rapidly globalizing world faces, and am excited to read some of the other books and papers cited by the author.
November 29, 2019
A short book that is largely focused on the empirics, explanations and policy remedies for inequality at the global level--measured between people across the world regardless of country. While this has fallen in the last twenty years, largely due to the rise of China and, to a lesser degree, India, it remains much higher than within country inequality. Bourguignon's analyzes the role of globalization in these developments and provides a set of recommendations that span development economics/international aid to the more conventional domestic policies like progressive tax/transfers.
June 27, 2019
A nice, light read on the topic of inequality. Complementary to proponents of the of topic such as Branko Milanovic, Thomas Piketty, or the late Anthony Atkinson.
April 13, 2022
J'ai retrouvé une fiche de lecture que j'avais faite en prépa, la voici :
La mondialisation a réduit les inégalités entre certains pays, par des phénomènes de rattrapage, mais a creusé celles au sein des pays. Pour éviter un trop grand accroissement des inégalités il faut nécessairement, et le plus rapidement possible, opérer une «mondialisation de la redistribution».
A partir des années 1980 on observe un retournement de tendance à l'évolution des inégalités entre les nations, elles se réduisent. Le développement rapide des pays émergents contribue à diminuer l'inégalité des niveaux de vie entre les habitants de la planète, c’est un phénomène de rattrapage. Cependant les écarts restent encore très importants, vers les années 1990, l'écart entre les 10% les plus riches au monde et les 10% les plus pauvres était supérieur à 100, il est de 90 en 2012. Par comparaison, dans un pays très inégalitaire comme le Brésil l'écart n'est «que» de 40.
On observe même une hausse des inégalités à l'intérieur des pays, notamment des pays développés. Aux États-Unis, en 2008, l'inégalité des revenus est aussi importante qu'au début du 20e siècle. Plus généralement, dans les trois quarts des pays de l'OCDE, la part des 20% les plus riches en termes de revenu disponibles, a augmenté d'au moins 2% du revenu total. Cette hausse est due notamment à l'augmentation du rendement du capital physique, financier et humain, au progrès technique, à un phénomène de «star system» et à la dérégulation des marchés, et donc à la mondialisation. Cela a donc des conséquences sur le chômage et l'exclusion sociale mais la mise ne place de mesures protectionnistes n'est pas une solution pertinente. Il s'agit plutôt d'essayer de combiner efficacité et équité.
En effet, une politique protectionniste efficace contre les pays émergents devrait être multilatérale, devrait concerner tous les partenaires commerciaux du pays souhaitant appliquer cette mesure, or cela semble inapplicable. De plus, les produits importés venant des puissances émergentes sont biens de consommation de masse, une augmentation de leur prix pourrait finalement rendre nul ou négatif le gain de cette politique. Par ailleurs, avec la mondialisation, la création d'un seul produit, par exemple l'Iphone, ne concerne plus un unique pays, compliquant encore l'application de ce type de mesures. François Bourguignon met en évidence que la réduction des inégalités entre les habitants du monde dépendra de la croissance des pays les plus pauvres, il dit ainsi « Il s’agit maintenant, ni plus ni moins, de faire «émerger » les pays pauvres d’Afrique subsaharienne et d’Asie centrale ». L'auteur considère qu'une solution pourrait résider dans une véritable redistribution internationale, il souligne que les pays riches consacrent environ 0,35% de leur revenu national à l'aide au développement des pays pauvres, alors que dans le système français 15% du revenu total des 20% les plus riches est redistribué au reste de la population, ce qui est 45 fois plus, montrant l'impact dérisoire qu'à actuellement l'action internationale. Les inégalités pourraient également être réduites par la fiscalité ou des politiques éducatives.
La mondialisation a réduit les inégalités entre certains pays, par des phénomènes de rattrapage, mais a creusé celles au sein des pays. Pour éviter un trop grand accroissement des inégalités il faut nécessairement, et le plus rapidement possible, opérer une «mondialisation de la redistribution».
A partir des années 1980 on observe un retournement de tendance à l'évolution des inégalités entre les nations, elles se réduisent. Le développement rapide des pays émergents contribue à diminuer l'inégalité des niveaux de vie entre les habitants de la planète, c’est un phénomène de rattrapage. Cependant les écarts restent encore très importants, vers les années 1990, l'écart entre les 10% les plus riches au monde et les 10% les plus pauvres était supérieur à 100, il est de 90 en 2012. Par comparaison, dans un pays très inégalitaire comme le Brésil l'écart n'est «que» de 40.
On observe même une hausse des inégalités à l'intérieur des pays, notamment des pays développés. Aux États-Unis, en 2008, l'inégalité des revenus est aussi importante qu'au début du 20e siècle. Plus généralement, dans les trois quarts des pays de l'OCDE, la part des 20% les plus riches en termes de revenu disponibles, a augmenté d'au moins 2% du revenu total. Cette hausse est due notamment à l'augmentation du rendement du capital physique, financier et humain, au progrès technique, à un phénomène de «star system» et à la dérégulation des marchés, et donc à la mondialisation. Cela a donc des conséquences sur le chômage et l'exclusion sociale mais la mise ne place de mesures protectionnistes n'est pas une solution pertinente. Il s'agit plutôt d'essayer de combiner efficacité et équité.
En effet, une politique protectionniste efficace contre les pays émergents devrait être multilatérale, devrait concerner tous les partenaires commerciaux du pays souhaitant appliquer cette mesure, or cela semble inapplicable. De plus, les produits importés venant des puissances émergentes sont biens de consommation de masse, une augmentation de leur prix pourrait finalement rendre nul ou négatif le gain de cette politique. Par ailleurs, avec la mondialisation, la création d'un seul produit, par exemple l'Iphone, ne concerne plus un unique pays, compliquant encore l'application de ce type de mesures. François Bourguignon met en évidence que la réduction des inégalités entre les habitants du monde dépendra de la croissance des pays les plus pauvres, il dit ainsi « Il s’agit maintenant, ni plus ni moins, de faire «émerger » les pays pauvres d’Afrique subsaharienne et d’Asie centrale ». L'auteur considère qu'une solution pourrait résider dans une véritable redistribution internationale, il souligne que les pays riches consacrent environ 0,35% de leur revenu national à l'aide au développement des pays pauvres, alors que dans le système français 15% du revenu total des 20% les plus riches est redistribué au reste de la population, ce qui est 45 fois plus, montrant l'impact dérisoire qu'à actuellement l'action internationale. Les inégalités pourraient également être réduites par la fiscalité ou des politiques éducatives.
November 24, 2019
Useful introduction/overview of the literature on global inequality. But nothing especially interesting or original here.
July 21, 2016
Brief and powerful summary of a topic that will haunt us if not handled with care. Very clear distinction between global and national inequality which we experienced recently. A laissez faire approach to it will not do as the biggest drivers in the past of global equality (China -India) move above the average global wealth per capita, they will turn into the greatest drivers of global inequality of the future.
April 26, 2016
A thought-provoking book. Bourguignon shows that even though the inequality between nations in the last two centuries might have declined, inequalities within nations went the opposite way. The book also discusses the nonmonetary inequalities, such as social justice and opportunity inequalities.
April 3, 2020
3.5 estrellas
No conozco lo suficiente sobre el tema, lo leí un poco rápido y creo que entendí como un tercio o un cuarto del total, pero de momento me parece que le estoy dando un puntaje apropiado, los detalles los puedo juzgar a la larga en una segunda lectura.
No conozco lo suficiente sobre el tema, lo leí un poco rápido y creo que entendí como un tercio o un cuarto del total, pero de momento me parece que le estoy dando un puntaje apropiado, los detalles los puedo juzgar a la larga en una segunda lectura.
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