Global View on Inequality: Trends and Insights

When we talk about inequality on a global scale, we are not just talking about the gap between rich and poor individuals – we are examining how income and wealth are distributed across continents, between countries, and within the borders of individual nations. The picture that emerges is complex and, in many ways, counterintuitive: the world has made measurable progress in narrowing the gap between countries, yet within many of those same countries, inequality has quietly been getting worse. Understanding this dual reality is essential to grasping how global development actually works.

What is global income inequality?
The Gini coefficient: measuring inequality in a single number
Between countries: a narrowing gap – with caveats
Within countries: inequality is rising
Europe: low but rising inequality
The Americas: two very different stories
Asia: growth with growing gaps
The pandemic’s effect: a setback to progress
Why does this paradox exist?
Looking ahead

What is global income inequality?

Global income inequality refers to the unequal distribution of income among all people on earth, regardless of national borders. It can be measured in two distinct ways: between-country inequality (differences in average income across nations) and within-country inequality (differences among individuals inside a single country). According to Development Initiatives, between-country inequality alone accounts for roughly two-thirds of all global income inequality – meaning where you are born remains the single most powerful determinant of your economic fate.

The numbers at the extreme ends of the spectrum are stark. Data from the World Inequality Report shows that the poorest half of humanity shares just 8% of global income, earning around $10 per day on average, while the richest 10% capture over half of all global income. According to World Inequality Report data, in 2025, the richest 1% of people globally received over 20% of total global income – up more than 3 percentage points since 1980.

The Gini coefficient: measuring inequality in a single number

Before exploring regional trends, it helps to understand the primary tool economists use to quantify inequality: the Gini coefficient (also called the Gini index). Introduced by Italian statistician Corrado Gini in 1912, it measures income distribution on a scale of 0 to 1 (or 0 to 100 as an index). A score of 0 represents perfect equality – everyone earns the same income. A score of 1 (or 100) represents perfect inequality – one person earns everything, and everyone else earns nothing.

In practice, most countries fall somewhere between 0.23 and 0.65. The OECD’s Society at a Glance 2024 report notes that among OECD nations, the Gini coefficient ranged from around 0.22 in the Slovak Republic – one of the most equal – to more than twice that value in Chile and Costa Rica. Nordic and Central European countries consistently register the lowest inequality, while Latin American countries, Türkiye, and the United States sit at the higher end. The Gini coefficient, while useful as a summary measure, is best read alongside supplementary indicators like income shares of the top 10% and the bottom 40%, since it can sometimes mask extreme concentration at the very top of the distribution.

Between countries: a narrowing gap – with caveats

One of the most cited findings in global inequality research is that the income gap between countries has been narrowing. The World Bank reports that the global Gini index fell from 70 points in 1990 to 62 points by 2019, a near-continuous decline driven primarily by faster income growth in populous developing nations – most notably China – compared to already-rich parts of the world. This trend represented the first sustained reduction in global between-country inequality since the early nineteenth century.

However, this headline figure requires an important qualification. Research published in Global Policy Journal finds that once China and India are removed from the analysis, the apparent convergence largely disappears. Without these two large, fast-growing economies, the global Gini coefficient for between-country inequality shows no such decline – the trend of convergence is, to a significant extent, an outcome of the economic rise of two uniquely large nations rather than a broad global pattern.

That said, the shift has been real for hundreds of millions of people. The United Nations notes that average incomes in developing countries have been increasing at a faster rate than in high-income nations – a trend largely credited to strong economic growth in China and other Asian economies. Still, the average income of people in North America remains around 16 times higher than that of people in sub-Saharan Africa, a reminder that the gap, while narrowing, remains vast.

Within countries: inequality is rising

Here is where the story takes a troubling turn. Even as the income gap between nations narrows, 71% of the world’s population now lives in countries where inequality has grown. This is the form of inequality that people feel directly – comparing their income not to someone in another country, but to their neighbour, colleague, or fellow citizen.

Brookings Institution research shows that income inequality has risen in most advanced economies and major emerging economies – countries that together account for about two-thirds of the world’s population and 85% of global GDP. The increase has been particularly steep in the United States, China, India, and Russia. Over the past four decades, what economists describe as a “squeezed middle class” has emerged in rich countries, while a new middle class has grown in emerging economies – but the very top of the income ladder has pulled away almost everywhere.

Europe: low but rising inequality

Europe remains the least unequal region in the world. The World Inequality Database’s 2024 regional review shows that the top 10% of earners in Europe receive about 36% of national income – far lower than in other major regions. The Nordic countries continue to report some of the world’s lowest Gini scores, benefiting from strong redistributive tax systems and social protections. However, inequality has been rising in Western Europe too, especially in Germany and France, where the income share of the top 1% has grown over recent decades. Eastern European countries like Romania and Bulgaria show higher inequality, with the top 10% capturing over 40% of national income.

The Americas: two very different stories

In the United States, pre-tax income inequality reached a post-World War II peak in 2023, with the richest 10% earning 47% of national income – up from 34% in 1980. Among OECD countries, the US has by far the most top-heavy income distribution. CaixaBank Research notes that the percentage of total income received by the top 1% in the US rose from 14.7% in 1990 to 20.9% in 2022.

Latin America presents a contrasting dynamic. The region carries some of the world’s highest Gini coefficients – with an average Gini of approximately 0.48 – but it is also one of the few regions where within-country inequality has actually declined over recent decades. Countries like Brazil and Chile have implemented more progressive taxation and expanded social programs, contributing to measurable reductions in their Gini scores, even if starting from a very high baseline.

Asia: growth with growing gaps

Asia’s economic rise has been the central driver of global inequality reduction between countries. But the picture within Asian nations is far more uneven.

China offers the starkest example of growth accompanied by internal divergence. Research on China’s income trends shows that income inequality rose sharply as the country transitioned from a collectivist economy to a market-oriented one, with the primary driver being the widening gap between urban and rural incomes and between coastal and inland regions. The World Inequality Report estimated that the top 10% in China captures around 41% of national income. While official data suggests income inequality has somewhat stabilised in recent years, research published in the Review of Income and Wealth confirms that wealth inequality has continued to climb sharply, with China’s wealth Gini rising from 0.54 in 2002 to 0.74 by around 2012.

India tells a similarly sobering story. A landmark 2024 study from the World Inequality Lab described India’s current level of inequality as exceeding even that of the British colonial Raj, coining the term “Billionaire Raj.” The study found that the income share held by the top 10% rose from 40% in 2000 to 58% in 2023, with the top 1% alone growing from 15% to 23%. Meanwhile, the middle 40% saw their share fall from 39% to 27% over the same period – a significant and rapid hollowing out of the middle.

The pandemic’s effect: a setback to progress

The COVID-19 pandemic disrupted nearly three decades of gradual progress on global inequality. According to the World Bank, the pandemic caused the largest single-year increase in global inequality since at least 1990 – the increase in between-country inequality in 2020 alone was three times larger than what had been seen over the entire previous decade. Countries were affected very differently depending on their health systems, government support capacity, and economic structure, causing incomes to diverge sharply across borders as well as within them.

The UN’s Sustainable Development Goals Report notes that prior to the pandemic, incomes of the poorest 40% had been growing faster than national averages in most countries – a positive trend that COVID-19 may have significantly disrupted, though the full long-term picture is still emerging from the data.

Why does this paradox exist?

The divergence between falling between-country inequality and rising within-country inequality is not accidental. Brookings researchers point to three interconnected forces: technological change, which rewards high-skilled workers while displacing lower-skilled jobs; globalisation, which has shifted manufacturing to cheaper labour markets and compressed wages in developed economies; and weakened redistribution, as net public wealth has declined in many countries since the 1980s, reducing governments’ capacity to offset market-driven inequality through taxes and transfers.

The World Inequality Report highlights that since the 1980s, net public wealth has become negative in the United States and the United Kingdom, and only marginally positive in France, Germany, and Japan – directly limiting governments’ ability to redistribute income and mitigate rising inequality. This shift has corresponded with a dramatic rise in private wealth concentration at the very top.

Looking ahead

World Bank projections caution that if current growth trends continue, global inequality may actually begin to increase again – because the countries that drove the past reduction in between-country inequality, particularly China, will no longer function as the levelling force they once were as they become middle- and upper-income economies themselves. Future progress on global inequality will depend far more on what happens within countries – through wage policy, social protection, tax systems, and access to education – than on economic convergence between nations. As development researchers have noted, future reductions in global inequality may depend less on South-North convergence and more on narrowing gaps within each country group.

What do you think? Given that countries like India and China have driven global poverty reduction while simultaneously seeing rising internal inequality, is economic growth alone a sufficient measure of development progress? And if within-country inequality is now the dominant driver of how people experience economic unfairness, what kinds of policies do you think governments should prioritise to address it?

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Table of Contents

What is global income inequality? 🔗

The Gini coefficient: measuring inequality in a single number 🔗

Between countries: a narrowing gap – with caveats 🔗

Within countries: inequality is rising 🔗

Europe: low but rising inequality 🔗

The Americas: two very different stories 🔗

Asia: growth with growing gaps 🔗

The pandemic’s effect: a setback to progress 🔗

Why does this paradox exist? 🔗

Looking ahead 🔗