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Increase in inequality easing since 2012

Published Thu, May 26, 2016 · 09:50 PM

THE launch of the IMD World Competitiveness Ranking is right around the corner. Every year, it uses a wealth of economic and scientific hard data as well as robust surveys of business executives around the world to determine the winners and losers of world competitiveness: defined as the ability of nations to create and maintain an environment in which enterprises can compete.

The rankings are an invaluable resource, whether companies are looking to set up in a competitive location, or for countries that want to find out how to kickstart their economies. Those 26 years of data compiled since the beginning of the rankings can also be used to see how inequality has evolved over the last quarter century. It is the most comprehensive database of country and business competitiveness, and a lens through which we can examine inequality in an unbiased way. Much of what we found is not what you might expect. Here are the most striking facts:

Inequality previously soared but is slowing down: The world did become increasingly unequal between 1995 and 2014 in terms of income differences among countries. But the rate of increase in inequality has been slowing since 2012. The wealth of the richest countries in the world has increased every year except for the last two. In contrast, poorer countries became poorer in the period between 1995 and 2000, and have since seen some improvement in living conditions.

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