The Geography of Inequality: Where and by How Much Has Income Distribution Changed since 1990?-Working Paper 341

The interplay of between- and within-country inequality, the relative contribution of each to overall global inequality, and the implications this has for who benefits from recent global growth (and by how much), has become a significant avenue for economic research. However, drawing conclusions from the commonly used aggregate inequality indices such as the Gini and Theil makes it difficult to take a nuanced view of how global growth interacts with changing national and international inequality. In light of this we propose and justify an alternative approach based on four consumption “layers” identified by reference to the global consumption distribution.We consider how each layer of global society has fared since the end of the Cold War.