25 Countries with the Highest Income Inequality in the World

Report: 25 Countries with the Highest Income Inequality in the World

In this report, we will be examining the 25 countries with the highest income inequality in the world. To skip the detailed analysis, you can directly view the 5 countries with the highest income inequality.

Introduction

Income inequality has been a significant aspect of global history. Initially, monarchies hoarded wealth, leading to vast disparities in income. However, as countries democratized and industrialized, income equality improved. According to the Organization of Economically Developed Countries, the income gap between the richest and poorest regions was only five times over 200 years ago.

While income inequality remains a concern, other aspects of quality of life, such as life expectancy and gender equality, have shown improvement. However, in the 1970s, the UK and the U.S., two leading industrial nations at the time, experienced slowed growth. This led to a shift in policies, favoring entrepreneurship and reducing taxes for high-income earners. This change contributed to the accumulation of wealth by the richest families. Even emerging economies like India and China are following a similar trajectory, potentially leading to increased income inequality.

The Impact of COVID-19

The COVID-19 pandemic has exacerbated income inequality globally. The International Monetary Fund reported that extreme poverty and extreme wealth continued to rise during the pandemic. Billionaires saw their wealth increase significantly, while millions of people lost their jobs. The World Inequality Report 2022 revealed that the top 10% of the population earns over half of the global income, emphasizing the rise in income inequality.

Reducing income inequality is not only a social issue but also a business risk. KPMG states that systemic inequality limits productivity, consumer spending, and growth. It can destabilize supply chains, trigger political instability, and jeopardize a company’s social license to operate. The private sector, alongside governments and civil society, plays a vital role in addressing inequality. Companies can contribute by implementing environmental, social, and governance (ESG) practices.

Income Inequality and Europe

While income inequality is a concern globally, some European countries have relatively low levels of inequality. Russia, despite the presence of oligarchs and political power, ranks 56th among countries with the highest income inequality. This is due to significant tax implementation in most European Union countries to distribute wealth and income more equitably.

Methodology

To determine the countries with the highest income inequality, data from the World Inequality Database was analyzed. The percentage of income attributable to the top 1%, top 10%, and bottom 50% of each country was considered. Countries were ranked based on these metrics, and the average ranking determined the final list.

25. Belize

1. Total income attributable to the top 1%: 19.6%
2. Belize raised its minimum wage for all worker categories in 2022 to decrease income inequality.

24. Bahamas

1. Total income attributable to the top 1%: 19.6%
2. Bahamas is a top tax haven, contributing to income inequality.

23. Bolivia

1. Total income attributable to the top 1%: 19.6%
2. The IMF emphasizes the need for well-designed social transfers, quality education, and healthcare to reduce income inequality in Bolivia.

22. Guatemala

1. Total income attributable to the top 1%: 19.6%
2. Poverty and income inequality are major issues in Guatemala.

21. Qatar

1. Total income attributable to the top 1%: 22.4%
2. The top 10% of Qatar’s population earns more than half of the total national income.

20. Congo

1. Total income attributable to the top 1%: 20.5%
2. Congo is one of the poorest countries, with a significant portion of the population living in poverty.

19. Bahrain

1. Total income attributable to the top 1%: 24.3%
2. Bahrain has a large immigrant population working in labor jobs, while the ruling family and citizens enjoy most of the wealth.

18. Thailand

1. Total income attributable to the top 1%: 22.9%
2. Thailand has the highest income inequality in East Asia, driven by differences in urban and rural income.

17. Maldives

1. Total income attributable to the top 1%: 35.6%
2. Income inequality in Maldives is geographical, with a concentration of poverty in certain areas.

16. Swaziland / Eswatini

1. Total income attributable to the top 1%: 19.3%
2. Gender discrimination contributes to income inequality in Eswatini.

15. Dominican Republic

1. Total income attributable to the top 1%: 28.6%
2. The poorest 50% of the population in the Dominican Republic has a small share of the total income.

14. Yemen

1. Total income attributable to the top 1%: 24.2%
2. The war in Yemen has worsened income inequality, leading to a humanitarian crisis.

13. Zimbabwe

1. Total income attributable to the top 1%: 21.1%
2. Income inequality in Zimbabwe continues to widen, accompanied by increasing poverty.

12. South Africa

1. Total income attributable to the top 1%: 19.3%
2. South Africa faces significant pay inequality and racial discrimination, contributing to income inequality.

11. Brazil

1. Total income attributable to the top 1%: 22.2%
2. Brazil has made progress in reducing income inequality, reaching its lowest point in the last 11 years.

   SDGs, Targets, and Indicators

   1. SDG 1: No Poverty

      • Target 1.4: Ensure that all men and women, in particular the poor and the vulnerable, have equal rights to economic resources, as well as access to basic services, ownership, and control over land and other forms of property.
      • Indicator 1.4.1: Proportion of the population living below the national poverty line, by sex and age group.

   2. SDG 10: Reduced Inequalities

      • Target 10.1: By 2030, progressively achieve and sustain income growth of the bottom 40% of the population at a rate higher than the national average.
      • Target 10.4: Adopt policies, especially fiscal, wage, and social protection policies, and progressively achieve greater equality.
      • Indicator 10.1.1: Growth rates of household expenditure or income per capita among the bottom 40% of the population and the total population.
      • Indicator 10.4.1: Income share held by individuals in the highest and lowest 20% of the income distribution.

   Table: SDGs, Targets, and Indicators

   SDGs	Targets	Indicators
   SDG 1: No Poverty	Target 1.4: Ensure that all men and women, in particular the poor and the vulnerable, have equal rights to economic resources, as well as access to basic services, ownership, and control over land and other forms of property.	Indicator 1.4.1: Proportion of the population living below the national poverty line, by sex and age group.
   SDG 10: Reduced Inequalities	Target 10.1: By 2030, progressively achieve and sustain income growth of the bottom 40% of the population at a rate higher than the national average.	Indicator 10.1.1: Growth rates of household expenditure or income per capita among the bottom 40% of the population and the total population.
   	Target 10.4: Adopt policies, especially fiscal, wage, and social protection policies, and progressively achieve greater equality.	Indicator 10.4.1: Income share held by individuals in the highest and lowest 20% of the income distribution.

   Analysis

   1. Which SDGs are addressed or connected to the issues highlighted in the article?

      The issues highlighted in the article are connected to SDG 1: No Poverty and SDG 10: Reduced Inequalities.

   2. What specific targets under those SDGs can be identified based on the article’s content?

      Based on the article’s content, the specific targets identified are:

      • Target 1.4: Ensure that all men and women, in particular the poor and the vulnerable, have equal rights to economic resources, as well as access to basic services, ownership, and control over land and other forms of property.
      • Target 10.1: By 2030, progressively achieve and sustain income growth of the bottom 40% of the population at a rate higher than the national average.
      • Target 10.4: Adopt policies, especially fiscal, wage, and social protection policies, and progressively achieve greater equality.

   3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

      Yes, there are indicators mentioned in the article that can be used to measure progress towards the identified targets:

      • Indicator 1.4.1: Proportion of the population living below the national poverty line, by sex and age group.
      • Indicator 10.1.1: Growth rates of household expenditure or income per capita among the bottom 40% of the population and the total population.
      • Indicator 10.4.1: Income share held by individuals in the highest and lowest 20% of the income distribution.

   Behold! This splendid article springs forth from the wellspring of knowledge, shaped by a wondrous proprietary AI technology that delved into a vast ocean of data, illuminating the path towards the Sustainable Development Goals. Remember that all rights are reserved by SDG Investors LLC, empowering us to champion progress together.

   Source: finance.yahoo.com

    

   

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