People worry more and more about inequalities but divide …

(MENAFN- Caribbean News Global) PARIS, France – For a strong, sustainable but also fair recovery from the COVID-19 crisis, tackling inequalities and promoting equal opportunities will be essential. Yet while there is a growing consensus that inequality is a problem, people are increasingly divided over its extent and what to do about it, according to a new report from the ‘OECD.

Is inequality important? says most people are concerned about inequality. Four in five people in OECD countries believe that income disparities are too great in their country. People care about inequality of outcomes and opportunities, as they perceive high disparities in income and income as well as low social mobility. In addition, concerns about income and income disparities have increased over the past three decades, along with increasing income inequality.

People’s perceptions are not disconnected from reality. Similar to trends in income inequality, people thought, on average, that high incomes earned 5 times more than low wages in the late 1980s / early 1990s, when this ratio top-down income has risen to eight today. , after peaking at 10 during the Great Recession. Tolerance for inequality has also increased, but to a lesser extent. Today, people think, on average, that the highest paid workers should earn 4 times more than the lowest paid workers, up from three times in the late 1980s.

More than 6 in 10 OECD citizens believe their governments should do more to reduce the income gap between rich and poor with taxes and transfers. The more people are concerned about inequalities and perceive low social mobility, the higher their demand for redistribution.

However, beliefs about the effectiveness of policies and the determinants of inequalities are important. People are less likely to ask for more redistribution if they think the benefits are poorly targeted, and they are less in favor of progressive taxation if they think corruption is widespread among public officials, prompting them to abuse and misallocation of public benefits.

The demand for more progressive taxation is also lower when people believe that disparities are justified by differences in personal effort, rather than by circumstances beyond their control. For example, in 2018, in Poland, 25% of respondents believe that poverty is due to lack of effort rather than injustice or bad luck and 54% ask for more progressive taxation, while in Germany , this figure is respectively 4% and 77%.

Yet while most people are concerned about inequality, they have very different beliefs about how big it is and what to do about it. In the average OECD country, a quarter of people think more than 70 percent of national income goes to households with the richest 10 percent, unlike another quarter who thinks less than 30 percent goes to households. the most rich.

In addition, the great heterogeneity of people’s views on inequality has increased over the past three decades, even among people with similar socio-economic characteristics. There is evidence of growing polarization: in most OECD countries, the gap is widening between those who think inequality is high and those who think it is low. The most unequal countries have a more divided public opinion: in Chile and the United States – two of the most unequal OECD countries – perceptions about the extent of the shares of the richest 10% diverge the most.

The report is available here.


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